Wall Street falls on tech sector, trade war worries

 

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NEW YORK: Wall Street shares plunged on Monday as investors fled technology stocks amid resurgent trade war worries, with key indexes trading below their 200-day moving averages and the S&P 500 closing below that pivotal technical level for the first time since Britain’s vote to leave the European Union in June 2016.

The first trading day of the second quarter began with a broad selloff concentrated in the technology and consumer discretionary sectors, as losses by Amazon.com, Tesla, and Microsoft, among others, took centre stage from retaliatory trade measures China unveiled on Sunday.

With the S&P 500 in a 10 percent correction from its record high in late January, investors were increasingly concerned a nine-year bull market might be in danger of ending.

“It’s more complicated than just a tech selloff. What’s hurting everything is that the S&P went through its 200-day moving average,” said Brian Battle, director of trading at Performance Trust Capital Partners in Chicago.

“That attracts momentum sellers and they don’t care what the fundamentals are.”

The Dow Jones Industrial Average fell 458.92 points (1.9 percent) to end at 23,644.19 after dipping below its 200-day moving average. The S&P 500 fell 58.99 points (2.23 percent) to 2,581.88 and the Nasdaq Composite dropped 193.33 points (2.74 percent) to 6,870.12.

Amazon.com was the biggest drag on the S&P 500, down 5.2 percent, as US President Donald Trump continued his Twitter attacks on the online retailer.

All 11 major sectors of the S&P 500 closed lower, with the biggest losses seen by the consumer discretionary and technology indexes, which were down 2.8 percent and 2.5 percent, respectively.

The tech-heavy Nasdaq was dragged lower by Microsoft, Intel, Apple Inc, Facebook, and Alphabet.

Shares of Tesla Inc ended the day down 5.1 percent after the company was reported to be making 2,000 Model 3s per week, missing its 2,500-point target.

 

Reuters

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