S&P/ASX 200 Index (ASX: XJO) tech shares are off to a poor start in early trade today.
While the ASX 200 is up 0.5% the S&P/ASX All Technology Index (ASX: XTX), which also contains some companies outside of the top 200 by market cap, is going the other way.
At the time of writing the All Tech index is down 2.1%.
Some of the heavier losses among ASX 200 tech shares are being posted by global payments giant, Block Inc (ASX: SQ2). The Block share price is down 5.9% to $108.80. This comes after its US listed shares tumbled 9% yesterday (overnight Aussie time).
Also in the red is accounting software provider Xero Limited (ASX: XRO), down 1.1%.
And WiseTech Global Ltd (ASX: WTC), which provides cloud-based software solutions for the logistics sector, is down 2.9% to $39.98 per share.
So why are tech companies coming under pressure?
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What's happening with the technology sector?
ASX 200 tech shares look to be following the lead of the Nasdaq.
The tech-heavy US index fell 2.4% yesterday, taking its year-to-date losses to 29.8%.
Growth shares the world over have come under pressure in 2022 amid rising interest rates and fears of a recession in the United States, the world's biggest economy.
Yesterday's hit to US tech shares was driven by a global social media provider, Snap Inc (NYSE: SNAP). Snap reported that macroeconomic conditions were deteriorating and lowered its profit forecast with its digital advertising revenue likely to come under pressure.
The Snap share price crashed 43% by market close.
Ouch.
The carnage at Snap hit most every big US tech share, with Alphabet (NASDAQ: GOOGL) – or Google if you prefer – dropping 5%.
And now ASX 200 tech shares are feeling the headwinds.
How have ASX 200 tech shares done in 2022?
With the RBA and central banks in many other nations lifting their benchmark interest rates for the first time in a decade this year, with more rate hikes flagged, growth stocks like ASX 200 tech shares have largely lost ground.
Year to date the All Tech index is down 32.8%, compared to a loss of 5.3% posted by the ASX 200.
