What happened
Shares of the content delivery network company Fastly (FSLY +1.30%) were falling Wednesday despite an apparent lack of company-related news. But the technology company may simply be following in the wake of the broader tech industry sector; the Nasdaq-100 Technology Sector index also slid Wednesday.
Fastly's share price was down by 4.3% as of 3:33 p.m. EDT, while the tech index was off by 0.6%.
So what
Many technology stocks have tumbled since the beginning of this year, as traders fled a sector that they had piled into during 2020.
Image source: Getty Images.
It appears that quite a few investors are still trying to figure out whether or not the tech stocks that they loved in 2020 are still investments they want to hold in their portfolios.
Many tech companies thrived during last year's lockdowns and social distancing efforts, but as the U.S. economy has reopened, the market has shifted its favor to other sectors. Fastly's stock is now down by 37% year to date. Its share price slide Wednesday could be have been propelled by the same negative sentiment toward technology stocks that has prevailed in recent months.
Now what
There's still a lot for Fastly investors to be optimistic about. The company is a leading CDN service and boasts some of the web's biggest content publishers and video streaming companies as clients.
Investors should remember that despite the recent share price drops, nothing has fundamentally changed with Fastly. Shareholders' initial reasons for buying and holding the stock should remain intact until and unless there's a significant change impacting the company's underlying business.
