The Zip Co Ltd (ASX: ZIP) share price continues to retrace on Monday following its heavy sell-off last week.
At the time of writing, the buy now, pay later (BNPL) company's shares are swapping hands at 99 cents, down 4.81%.
This comes after the share dropped more than 20% last week as investors took profit off the table.
It is worth noting that Zip shares accelerated from a multi-year low of 43.5 cents on 23 June to a high of $1.52 on 28 July, representing a 250% gain.
Let's look at what's causing the BNPL's shares to stall again today.
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Why are Zip shares tanking?
The Zip share price is coming under selling pressure following negative sentiment across the broader sector.
To compare, the S&P/ASX 200 Financials Index (ASX: XFJ) is recording a 1.3% loss today.
Re-emerging fear about more aggressive interest rate hikes from the Federal Reserve appears to be weighing down investor confidence. This is having a rampant effect on the Aussie stock market.
The Dow Jones Industrial Average futures is down by 126 points, or 0.37%.
The S&P 500 and Nasdaq 100 futures are also in the red by 0.39% and 0.47%, respectively.
It could be a volatile week ahead on the back of Fed Reserve chair Jerome Powell's latest comments on inflation.
Similarly, other shares in BNPL companies are heading south today.
The Block Inc (ASX: SQ2) share price is down 6.58%, fetching $107.33.
On the other hand, shares in Sezzle Inc (ASX: SZL) are backtracking 6.29% to 74.5 cents.
Zip share price snapshot
In early 2021, the Zip share price reached an all-time high of $14.53.
It was also valued more than popular retail chain JB Hi-Fi Limited (ASX: JBH).
However, those days seem like a distant memory as the BNPL provider reversed its historic gains. Now it commands a market capitalisation of around $715.50 million, well under the $4.84 billion that JB Hi-FI is currently worth.
Year to date, Zip shares are down by roughly 77%.
