Latest Articles

What is High Octane Gasoline?

High octane gasoline, often associated with high-performance vehicles and racing, plays a crucial role in optimizing engine performance and efficiency. This article delves into...
HomeLatestTech-Heavy Nasdaq Leads Wall Street Lower as Megacaps and Chips Slide
Advertisements

Tech-Heavy Nasdaq Leads Wall Street Lower as Megacaps and Chips Slide

All three major Wall Street indexes experienced declines of over 1%, with the Nasdaq being most affected. Weakness in megacap growth companies, including Apple Inc, and a decline in the chip sector weighed heavily on the tech-heavy index. The retreat comes ahead of key economic data releases and Federal Reserve Chair Jerome Powell’s remarks later in the week.

Advertisements

Economic data on Tuesday showed mixed signals, with slower growth in the U.S. services industry in February and a decline in employment. However, a measure of new orders reached a six-month high, indicating underlying strength in the sector. Despite the Federal Reserve’s interest rate hikes, the Purchasing Managers Index report confirmed continued economic growth.

Advertisements

The technology sell-off on Tuesday was attributed to profit-taking, especially after the sector’s substantial 56% rally in 2023. Apple shares finished down 2.8% following a report showing a 24% year-on-year decline in iPhone sales in China. The chip sector also suffered after reports that Advanced Micro Devices faced challenges selling an AI chip for the Chinese market due to increased technology export restrictions.

Advertisements

The Dow Jones Industrial Average fell 1.04% to 38,585.19, the S&P 500 lost 1.02% to 5,078.65, and the Nasdaq Composite dropped 1.65% to 15,939.59. Among major S&P 500 industry indexes, technology and consumer discretionary were among the sectors declining.

Investors are anxiously awaiting Powell’s testimony and economic data, including the non-farm payrolls report. The market is pausing after recent rallies, with some viewing the pullback as a healthy breather. Traders are closely monitoring interest rate policy clues, with expectations of the first rate cut in June.

Tesla shares sank 3.9% after its European Gigafactory near Berlin halted production due to a suspected arson attack. In contrast, Target shares surged 12% after the retailer provided an optimistic forecast for annual comparable sales.

MicroStrategy shares tumbled 21% after the company announced a private offering for $600 million in convertible senior notes, with plans to use the proceeds to buy bitcoin.

Declining issues outnumbered advancers on the NYSE and Nasdaq, with a negative ratio on both exchanges. The S&P 500 posted 50 new 52-week highs and eight new lows, while the Nasdaq Composite recorded 93 new highs and 113 new lows. The total trading volume on U.S. exchanges was higher than the 20-session average.

Advertisements
Advertisements