The extraordinary rally in markets, since their plunge in the very first stages of the coronavirus pandemic, was based on two reasonable assumptions. One was that lockdowns would permanently change how we live our lives — benefiting, above all, the technology giants. The other was that central banks would be unable to raise interest rates from emergency levels, at least for the foreseeable future. The fall in the value of the tech-heavy Nasdaq Composite index during the past few weeks demonstrates that both are now being tested. That might be bad for tech investors but, ultimately, it reflects good news for everyone else.

Since its peak in November last year the index has fallen by over 10 per cent, meeting the technical definition of a market “correction”. This has been led by lockdown-sensitive stocks. On Thursday, reports that luxury exercise bike maker Peloton — a diversion for those confined to their homes — was halting production due to falling demand led to a sharp drop in its shares. Then after the market closed, Netflix, the streaming service, warned investors that subscriber growth was set to slow. Falling share prices for the two companies mean they are joining other previous pandemic winners such as Zoom, the videoconferencing software maker.

A broader sell-off in riskier assets also reflects the changing stance of major central banks, especially the Federal Reserve. Investors have lost interest in lossmaking technology companies, in particular, since Fed chair Jay Powell indicated that the central bank would begin to withdraw its emergency pandemic support earlier than first predicted. Growth companies of this sort are the most sensitive to changes in interest rates.