Market Turbulence: Should Investors Buy Nvidia, Meta, and Amazon Now?

Chicago, IL – March 10, 2025 – Today, Zacks Investment Ideas feature highlights Nvidia (NVDA), Meta (META), and Amazon (AMZN).

Assessing the Right Time to Invest in Tech Stocks

Recent market turbulence escalated on Thursday when buyers struggled to maintain support at the Nasdaq’s 200-day moving average during the week.

Concerns over the ongoing tariff disputes among the U.S., Canada, Mexico, and China have rattled Wall Street. The unpredictability of the current administration’s next moves raises questions about the broader economic implications. Nevertheless, it seems unlikely that officials wish to inflict serious damage on the U.S. economy or the stock market.

Despite this, a continued downturn may be imminent as investors of all sizes hurry to secure substantial profits amidst growing apprehension.

Understanding the Current Selloff

The current selloff was anticipated, especially after the artificial intelligence sector sparked dramatic triple-digit increases for various stocks in recent years.

Nvidia stands out as a key player, having surged by 380% over the past two years and by an impressive 1,700% over the last five years. Although Nvidia experienced a recent decline, its stock is still up 21% in the past year.

Over the last five years, both the Nasdaq and the S&P 500 have gained over 100%. The S&P 500 has seen a 44% increase in the last two years, while the Nasdaq has risen by 55% during the same period. Investors may begin to lock in profits as their significant paper gains face potential erosion.

So, when might it be the right moment to invest during this downturn?

For the first time since Q4 2023, both the Nasdaq and S&P 500 fell below their 200-day moving averages, with the Nasdaq briefly dipping below in August 2024 before making a strong recovery.

Currently, both indices are testing their 50-week moving averages. The market could experience further declines as it recalibrates valuations towards historical medians, given that the S&P 500 is trading at 20.6 times forward earnings compared to its 10-year median of 18.1 times.

Some analysts speculate that a return to late 2021 peak levels may not be out of the question. Ultimately, forecasting market movements remains uncertain, and investors should be cautious of anyone claiming to predict future trends.

However, data reveals that both the S&P 500 and the Nasdaq have transitioned from overbought RSI levels at the end of 2024 to some of their most oversold conditions in years. Market exuberance appears to have dissipated. CNN’s Fear & Greed Index, a commonly tracked contrarian market signal, plunged from Neutral in mid-February to Extreme Fear (17 out of 100).

Importantly, the S&P 500’s earnings growth outlook remains robust, following updated guidance from leading tech companies. Zacks’ recent data forecasts benchmark earnings growth of 13.3% in 2025 and 13.7% in 2026, a significant increase compared to the 7.3% growth projected for 2024. Furthermore, the Federal Reserve is expected to lower interest rates in 2025.

With earnings and interest rates being pivotal market drivers, investors may consider cautiously entering into beaten-down stocks and ETFs, or at least preparing to act if substantial further declines occur.

Should Investors Scoop Up Tech Stocks and ETFs Now?

Invesco’s QQQ ETF is designed to track the Nasdaq-100 Index, offering wide exposure to prominent tech firms such as Apple, Microsoft, and Nvidia.

QQQ provides a straightforward method for investing in the tech sector without the risks of picking individual stocks. Like the broader Nasdaq, the ETF has also dipped below its 200-day moving average.

The tech ETF has relinquished all gains made since the Trump election and has now fallen below last summer’s highs.

QQQ’s recent slide has pushed it to nearly a correction zone, with a decline of approximately 10% from its February peaks. Investors with a long-term perspective might want to consider gradual investments in QQQ now and potentially increase their holdings if it continues to fall.

For those interested in individual tech stocks, both Meta and Amazon deserve attention.

Meta‘s stock has fallen 15% since February 14. This downturn has shifted Meta from its notably overbought RSI levels to oversold conditions, now trading below its 50-day moving average.

Currently, Meta is priced at its 10-year median and is 60% cheaper than its 10-year highs, trading at 24 times forward 12-month earnings. The company’s bull case remains clear: despite facing competition from TikTok and others, Meta’s core social media and messaging services continue to excel.

As smartphone usage remains prevalent, Meta’s reach spans 3.3 billion users daily across its platforms. Additionally, Mark Zuckerberg and the team are advancing in the AI competition through a commitment to open-source AI.

Zacks projects Meta’s earnings growth to be around 12% for 2025 and 2026, underpinned by anticipated sales growth of 15% and 13%, respectively. This environment might entice some investors to consider purchasing Meta shares now or to keep it on their watchlists for better pricing opportunities.

Amazon has experienced a significant 17% drop since its early February earnings announcement. Many investors used the report as an opportunity to take profits on the overheated stock.

Amazon’s stock has now tested its 200-day and 50-week moving averages, and potential further selling pressure may emerge. Despite this, Amazon currently trades over 90% below its highs and at a 50% discount to its 10-year median, priced at 31.9 times forward 12-month earnings.

Amazon’s stock is valued at some of its lowest forward earnings levels since the 2008 financial crisis, primarily influenced by its current market conditions.