LONDON, (Reuters) – Tech-dominated growth stocks remain expensive despite sharp drops over the past six months. Analysts at JPMorgan (NYSE) warned Monday.

The so-called FAANGs saw some COVID-era spikes in their shares this year. Facebook (NASDAQ;) fell 38%, Apple, (NASDAQ.) dropped 5.7%, Amazon, (NASDAQ.) declined 8.5%, Netflix (NASDAQ.) was down 35%, Google (NASDAQ.) down 35%, 10% and Google (NASDAQ.) were down 35% and 10%.

JPMorgan analysts believe that tech companies that have yet to make profits have lost on average 30% since September peak, while “fintech” firms that focus on technology-savvy tools and apps have seen a 40% drop in value.

“As Growth stock prices weakened recently, they derated but are still no outright cheap,” JPMorgan analysts wrote to clients. They added that commodity-linked and banks which rose this year due to higher oil and metals prices and interest rates, were still “far away from expensive”.

It is possible that the earnings of the ‘growth sector’ might no longer be extraordinary, but the biggest driver for bond market borrowing costs remains, which has risen this year because top central banks laid the foundations for rising interest rates.

Years of record-low rates have fuelled the tech stock rally but with those rates now rising again the appeal of stratospherically-valued tech stocks gets dimmer for investors, especially if their growth trajectories splutter.

JPMorgan stated that “we believe that bond yields would continue moving higher throughout the course of the Year,” referring to bond market costs.

Our fixed income strategists anticipate U.S. 10-year Treasury yields reaching 2.35% before the end of 2012, while German 10-year yields will reach 0.5%. The yields on Treasury bonds are currently at 1.92%, while the bunds for Germany are 0.2%.

The experts also stated that tensions between Russia and the West over Ukraine should not drive a return of big tech companies, who carved out a safe haven image during the pandemic.

Geopolitics may flare up to month-end, but we don’t expect it to last and ask for internal risk to return to spring.