The stock market took a tumble this morning (in case you hadn't noticed), with the Dow, Nasdaq, and S&P 500 all down well over 2%. Tech stocks are taking things especially hard on the chin. In early trading, shares of both sign-documents-from-home e-signature company DocuSign (NASDAQ:DOCU) and watch-movies-at-home streaming service Netflix (NASDAQ:NFLX) were down nearly 10%, while shares of over-the-top streaming device-maker Roku (NASDAQ:ROKU) tumbled 5%.
As of 10:20 a.m. EST, DocuSign shares remain down 3.2%, Netflix down 2.6%, and Roku is off 4.6%.
The reason: the coronavirus. Over the weekend, it was reported that the Chinese COVID-19 coronavirus had broken out in multiple new locations, including Italy and South Korea. Johns Hopkins University, which was attempting to keep track of the disease's progress on a central website, got swamped by new requests for data this morning and is now reporting no data at all.
(And nothing's more likely to spark a panic on Wall Street than the complete absence of data).
Still, does it make sense to sell these stocks in particular? After all, just last week, I made the argument that DocuSign and Netflix stocks, at least, should be immune to coronavirus concerns because they've built their businesses upon the idea that people can stay home and avoid contact with other humans if they want to. (Roku, by the way, does essentially the exact same thing.)
I suppose I could see a reason for today's news to spark a sell-off in companies that profit from bringing people together in close proximity -- cruise lines, for example, or airlines and restaurants. But stocks that intentionally make it easier for business to go on, and for people to live their lives safely from the comfort of their own homes?
That makes no sense at all. DocuSign, Netflix, and Roku stocks may all be down today, but I predict they'll be right back up in relatively short order.