(Bloomberg) — U.S. futures on the Nasdaq 100 declined as clouds gathered around a five-month rally that has fattened tech valuations and whipped up speculation in options.September futures on the gauge dropped 0.8% as of 9:56 a.m. in Tokyo. Contracts on the S&P 500 were little changed, erasing a decline of as much as 1.1%. Equity losses last week were capped with two of the most volatile days of the summer, with technology shares at one point dropping 10% from a recent high after nearly doubling since March.Anxiety has ratcheted up for investors who have ridden a powerful rally from the depths of the virus panic in March. Megacap tech companies, a bastion of strength in an advance that has added $7 trillion to their value, showed signs of buckling at the end of the week amid reports that huge options bets were fanning their gains.Valuation is emerging as a concern for bulls. At about 26 times annual profits for the S&P 500 and 37 times for the Nasdaq 100, American shares are still trading at the highest multiples in more than a decade, despite last week’s selloff. Price-earnings ratios for tech companies such as Apple Inc. and Microsoft Corp. have nearly doubled since March, reflecting the strength of the rally and the sluggish pace of economic growth.“While news flow wasn’t overtly negative — progress toward a virus vaccine continues and economic data indicates further recovery — a slowing rate of ‘upside surprises’ may be refocusing investors’ attention on arguably extended valuations,” wrote Julian Emanuel, chief equity and derivatives strategist at BTIG, in a note to clients. He also cited uncertainties about federal stimulus, the November elections and “simmering U.S./China tensions.”Exacerbating nervousness are growing positions in options on technology stocks, especially call contracts tied to further gains. Volume in bullish bets on companies like Amazon.com, Apple and Tesla Inc. has surged in the last month to some of the highest levels ever, much of it in small lot sizes that denote individual investors.The Financial Times reported Sunday that over the last few months SoftBank has accrued paper profits of about $4 billion from options bets tied to about $30 billion worth of stock. Analysts have raised concern that gains in stocks that have benefited from dealer hedging around such positions will prove fleeting or contribute to volatility if the wagers are unwound or the market turns quickly against them.”When volatility gets to a certain point, it can start working against a position,” said Scott Bauer, chief executive officer at Prosper Trading Academy in Chicago. ”Volatility always normalizes.”For more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.