U. S. stocks have experienced an ultra-long bull market over the past decade, benefiting from global monetary easing and technological advances. Among them, the performance of technology companies represented by FAANG is particularly eye-catching, which has become the "engine" to promote the continuous rise of the Nasdaq and even the entire US stock market.

However, this situation seems to have reversed in 2022.

On April 19th, streaming media giant Netflix Inc reported another "thunderstorm" in the first quarter. The company's global net paying users fell by 200000 in the first quarter, the first time in a decade, and expects more customers to be lost in the coming months. The company's share price "collapsed" immediately after the announcement of the results. Netflix Inc plunged 39% in intraday trading on April 21, the biggest intraday drop since 2004.

Netflix Inc's market capitalization was higher than that of its rival Walt Disney Company two years ago. But Netflix Inc's share price has fallen more than 70 per cent since November and its market capitalization is now less than half that of Walt Disney Company.

On February 3, Facebook Inc (renamed Meta) reported a sudden "thunderstorm" in the four seasons, with earnings per share falling twice as much as market expectations and poor key user indicators. After the announcement of the results, the share price plunged 26.39% in a single day.Suffered the biggest one-day decline in the history of the US market.

Although the quarterly report shows that the number of daily active users of Facebook Inc has returned to growth, the parent company Meta's revenue growth in the first quarter was the slowest since it went public, the advertising business, as a pillar of revenue, is still struggling, and the outlook for the new layout of metamosmos is still unclear.

So far, Facebook Inc's market capitalization has plunged nearly $400 billion from a peak of nearly $1.1 trillion last summer.

Of course, the difficult times of Facebook Inc and Netflix Inc do not mean that they will not make a comeback, nor does it mean that Apple Inc, Amazon.Com Inc and Alphabet will face the same fate.

Despite Netflix Inc's troubles, it has been one of the best-performing stocks of the past 20 years, up 18000 per cent since listing in 2002, with an average annual return of about 30 per cent. Over the same period, Apple Inc's return, including dividends, exceeded 42000 per cent (an average annual return of 35 per cent), while Amazon.Com Inc's return was 1500000 per cent (an average annual return of 29 per cent).

"these companies have grown from microenterprises or start-ups to large companies in a record short period of time," said Michael O'Rourke, chief market strategist at Jones Trading, an institutional broker. "the fault of the market is that people think it will last forever. "

The best of times are over.

So, does the weakness of the tech giants mean that the "engine" of US stocks will "stall" or even "reverse" in 22 years?

For current technology stocks, the biggest pressure is for the Federal Reserve to raise interest rates. Wall Street mentioned earlier that at a recent discussion hosted by IMF, Federal Reserve Chairman Powell once again announced that he would discuss raising interest rates by 50 basis points at the May meeting, and hinted that he would do so more than once this year.

As the Fed tightened monetary policy and investors fled the market for fear of an economic slowdown, Alphabet, Amazon.Com Inc and Microsoft Corp all lagged behind the S & P 500.

Another problem is that the surge in US bond yields has lowered future profit expectations, a big deal for technology companies, which usually enjoy higher valuations by promising higher earnings.

It turns out that instead of raising returns as much as they did a decade ago, these companies have become a drag on the market. Data from Bespoke Investment Group, a research institution, showThe market capitalization of FAANG plus Microsoft Corp accounts for less than 1/4 of the market capitalization of the S & P 500, but contributes more than half of its decline.

According to Bloomberg, investment agency Miller Tabak + Co. This should upset bulls expecting a quick rebound, said Matt Maley, an analyst."when a market is supported by several stocks, it does not last long. "if these stocks fall, so will the market. "

Of the six companies, Apple Inc is the only one that outperformed the S & P in 2022, but only a little.

While investors still value Apple Inc's loyal customers and huge cash flow, it is hard to call the world's largest company a growth company. Analysts compiled by Bloomberg estimate that sales of iPhone, Mac and iPad soared and Apple Inc's revenue soared during the outbreak as consumers were trapped at home, but analysts expect sales to grow only 8% this fiscal year and continue to slow until at least 2024.

In FAANG, only Amazon.Com Inc and Alphabet may still be considered growth companies. Amazon.Com Inc's revenue is expected to grow by 15% this fiscal year. Alphabet expects to achieve 18% sales growth this fiscal year.

GE Greg Taylor, chief investment officer of Purpose Investments, a management company, said FAANG may not have lost all its advantages, at least for now. These companies are still worth owning, either because they are expanding or because they have strong balance sheets and share buyback potential, which they can use to boost earnings per share.

This does not mean that they are losers, they just need to develop, and investors need to see their nature-more core shareholding than growth.