It’s hard to call time on Big Tech

“Calling a market top has wrongfooted pundits through the ages,” says Michael Mackenzie – and last week’s big “correction” of US tech stocks has “stirred the debate again”. But the real question facing those betting on a bigger rout is “what is the alternative”, when “tech still offers solid growth prospects and the potential for a significant return on equity”? It’s natural to draw comparisons with crashes that followed other market peaks – such as those in 2000 and 2007. “But those market heights were followed by a protracted decline in earnings growth over ensuing quarters”, whereas the hit from the pandemic – for the tech industry at least – “appears far less extensive”. Covid-19 has accelerated digital trends for business, education and households and, even if a vaccine arrives, these “shifts in behaviour” are likely to continue. “Unless earnings decline noticeably and prove high valuations wrong”, stocks do not tend to drop in any “persistent way”. The current market is no exception. That makes it “hard to call time on Big Tech and the equity-growth bull run”.

Sometimes described as “gutsy”, Fraser is credited with working “frantically” to “keep the bank afloat” during the 2008-09 financial crisis, said The Sunday Times. As head of strategy and M&A, she “executed 25 deals in 18 months”. But she also has experience in more earthy roles. In 2013, she moved to Missouri to run Citi’s mortgage bank: “I dumped the Chanel suits and found myself in jeans,” she observed. In 2015, as head of Citi’s LatAm operations, “she took on a Mexican business gripped by a money-lending and fraud investigation”. Although Fraser has been seen as Citi’s “next CEO” for some time, Wall Street “has some questions” about the timing of her promotion, said DealBook in The New York Times. It may have come “sooner than expected” because of stumbles by her current boss, Mike Corbat, under whose tenure Citi’s stock has languished. Certainly, it wouldn’t be “the first time that a woman has been elevated to clean up a mess” when the risk of failure is high. Let’s see how Fraser gets on at the top of the “so-called glass cliff”.