What was once seen as a third-quarter recovery for tech investors has turned out to be a flop.

The Nasdaq Composite plummeted 5.1% this week after falling 5.5% the week prior. The worst two-week period for the market occurred over those two weeks, when the tech-heavy index dropped more than 20% in March 2020 at the start of the Covid-19 epidemic in the United States.

Next week marks the end of the third quarter, and if the Nasdaq doesn’t reverse the 1.5% decline that has occurred during the past five trading days of the quarter, it will record losses for the third straight quarter.

Investors have been selling off tech equities since late 2021 on the grounds that they will be disproportionately impacted by rising interest rates and inflation, according to the argument. Currently, the Nasdaq is just a little bit over its June low from the prior two years.

The Fed’s ongoing rate hikes, which on Wednesday raised benchmark interest rates by another three-quarters of a percentage point and signalled they might go further higher, had a disastrous impact on the markets. The Fed is trying to bring inflation down from its highest levels since the early 1980s. The central bank raised its federal funds rate for the third time in a row by 0.75 percentage points, bringing it to the highest level since early 2008, which is between 3% and 3.25%.

The 10-year Treasury yield has increased to its highest level in 11 years as a result of rising rates, which has strengthened the dollar. American exports become more expensive as a result, affecting IT companies that rely significantly on exports.

On Friday’s “TechCheck” on CNBC, Jack Ablin, chief investment officer of Cresset Capital, said that “this is a one-two hit on tech.”

Technology suffers from a high dollar. High yields on the 10-year Treasury are bad for technology.

Among the mega-cap companies, Amazon had the worst week with a decline of approximately 8%. Alphabet, the parent company of both Facebook and Google, had a 4% fall. All three businesses are now enacting cost-cutting measures or hiring freezes due to a combination of diminishing client demand, sluggish advertising spending, and inflationary pressure on wages and products.

Employees grilled Alphabet CEO Sundar Pichai during this week’s all-hands meeting, according to CNBC on Friday. The workforce expressed worries about cost savings and recent comments from Pichai emphasising the need for a 20% boost in productivity.

The start of the tech earnings season is almost a month away, and growth predictions are still muted. Alphabet is predicted to experience single-digit revenue growth after increasing by more than 40% a year earlier, while Meta is forecasting a second consecutive quarter of declining revenues. It is projected that Apple will expand by a little more than 6%. The performance of Amazon and Microsoft is anticipated to be stronger, with forecasts of 10% and 16%, respectively.

Over the past week, some sharing economy enterprises faced extraordinarily challenging situations. DoorDash, Uber, Airbnb, and Lyft all saw declines of between 12% and 14%. The cloud software market, which had been booming before it fell in 2022, had some of the biggest decreases in the shares of GitLab (-16%), Bill.com (-15%), Asana (-14%), and Confluent (-13%).

The Salesforce cloud computing giant held its annual Dreamforce conference this week in San Francisco. During the conference’s session on financial indicators, the company made a new long-term profitability goal public to show its commitment to operating more efficiently.

In order to account for potential future acquisitions, Salesforce plans to attain an adjusted operating margin of 25%, according to Chief Financial Officer Amy Weaver. This is more ambitious than the 20% goal Salesforce had set for its fiscal year 2023 one year prior. The company is seeking to reduce sales and marketing as a percentage of revenue by boosting self-serve efforts and improving salespeople’s efficiency.

The price of Salesforce shares fell 42% over the past year and 3% during the past week.

There are so many things happening in the market, co-CEO Marc Benioff said during an interview with CNBC’s Jim Cramer at Dreamforce. between the economy, the recession, the epidemic, and the currencies. You sort of have to navigate all of these issues.