Investors focused on environmental, social and governance (ESG) factors may also have cause for concern
By Julien Ponthus, Aaron Saldanha, and April Joyner
LONDON/NEW YORK (Reuters) - Bitcoin, shares of Tesla and a high-flying exchange-traded fund (ETF) fell on Tuesday, retreating from recent rallies in a volatile session that gave investors a gut check.
It was the latest sign of a possible pause in a rally that has buoyed a broad range of assets. Investors may be growing wary of sky-high valuations, while recent rises in Treasury yields could dim the allure of stocks and other comparatively risky investments.
"We have been in a sustained rally and there was a lot of leverage in the system," said Ty Young, crypto asset research analyst at crypto data platform Messari, of Bitcoin. "Corrections are to be expected during a bull run and not surprising when looking at previous cycles.
Bitcoin was recently down 11% at $48,207, paring some losses after Jack Dorsey's Square Inc said it bought around 3,318 bitcoins for $170 million. The cryptocurrency had fallen as low as $44,845 during the session.
Shares of Tesla, which recently disclosed a $1.5 billion investment in cryptocurrency, fell as much as 13.4% and pared losses to end down 2.1%. The ARK Innovation ETF, which counts Tesla as its biggest holding, finished 3.3% lower.
Recently popular exchange-traded funds (ETFs) focused on industries such as blockchain, cannabis, and renewable energy have also taken a hit in the past week-and-a-half, with some investors growing skittish.
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