Amazon joined other big tech firms this week when it announced significant layoffs of its staff. Buoyed by low interest rates big technology firms have dominated the stock market and grown in size. But now the market is turning on them. The figure below shows the FANG+ index an index of the biggest publicly traded tech firms, over the last 3 years compared to the S&P 500. Much of the run up in stocks came from tech, and now it accounts for a big share of the fall in prices. The question is will a contraction of the tech sector spill into the rest of the economy when it comes to jobs too?

Source: FANG+ Index and S&P 500

Allison Schrager is a senior fellow at the Manhattan Institute. Follow her on Twitter here.