‘Big tech is here to stay’: Fund manager says tech stock correction ‘temporary’

Passive investors, the backbone of the Nasdaq’s rally this year, seem to have lost their nerve, pulling massive amounts of cash in recent days from index-tracking technology funds in what many see as an ominous sign for the sector.

With the tech-heavy Nasdaq 100 down more than 13% after a record 84% rally off March lows — in correction territory — many investors are speculating that a reversal could pick up speed as a COVID-19 vaccine gets closer.

Goldman Sachs, for example, predicts at least one vaccine will be approved by the end of this year. That should help broader markets but weaken the case for shares in companies that benefit when people are forced to stay home, whether cloud computing or e-commerce.