Can someone smarter than me explain why big tech stocks are suffering because of interest rates over 1%? If they are so valued, why don’t earnings provide them with capital? Why do they need free money to thrive?
It’s called time value of money. The valuation of a company is based upon present and future earnings. Future earnings are discounted based upon the interest rate. The higher the rate, the less valued the future earnings, the lower the value of the company and the lower the stock price.
The higher the 10 year, the higher the discount rate, the higher the discount rate, the lower the valuation. Look up the CAPM model for a high level overview. Ps large caps have held up better