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Tech Stocks Drop as Dow Drops in S&P 500 Floating Session

As investors’ concerns about economic growth and rising interest rates continued to weigh on the markets, US stock indices fell and sales in technology stocks deepened.

The S&P 500 fell 2% in the early Tuesday afternoon. The Dow Jones Industrial Average fell 1% and the technology-heavy Nasdaq Composite fell 3.3%.

Investors consider a series of signals as they try to determine the trajectory of the US economy. Many worry that the Federal Reserve’s monetary tightening plans to curb inflation could plunge the economy into recession.

Tuesday’s losses mark a sharp pullback from Monday. When the leading US indices rally after a choppy trading session the previous week. But it’s a late Monday profit and income alert from social media company

blow up

Investor sentiment has cooled again. A disappointing report on Tuesday showing new home sales in the US that slowed in April further darkened the mood.

Shares of Snap fell 42% on Tuesday as investors digested comments that the macroeconomic environment was worsening than expected. Concerns about cuts to Snap’s ad revenue are reflected in other tech stocks that have been battered this year.

Meta Platforms

9.6% and Google-parent shed


fell 6.7%.

Meanwhile, he said home sales data, which fell well short of economists’ expectations, are another sign that the Fed’s rate hikes are already slowing the real economy.


US Securities.

“This is a pretty weak number,” he said, adding that the trend is a sign that more home buyers are getting bored with the market. Mortgage interest rates are rising.

Among the catalysts that caused the S&P 500 to drop 17% from its January high by Monday were concerns about slowing growth amid high inflation. Investors are now watching closely to see if the S&P 500 is entering bear market territory, which is defined as at least a 20% drop from its recent high. On Friday, the benchmark index neared its end before ending in a bear market. saved by late session rally.

On Tuesday, stocks with more footholds in the physical economy posted tighter losses or gains as major tech companies began to get hammered. The S&P 500’s core consumer goods, packaged food and utilities sectors were just three of the index’s 11 components in positive territory.

Tim Courtney, chief investment officer at Exencial Wealth Advisors, took this as a sign that inflation and the Fed’s response continue to be a bigger concern for many investors than the underlying health of the economy.

Courtney said wealth management clients are taking the stock market’s downturn in stride this year, but fears are mounting as bear market levels for the S&P 500 approach.

“Last week, as we approached that magical bear market barrier, I think concerns began to rise,” he said.

Disappointing company-wide earnings and warnings exacerbated fears.

Abercrombie & Fitch

On Tuesday, it became the latest retailer to lower investor sentiment after returning to a first-quarter loss due to higher costs. The company’s shares fell 31%.

Mizuho’s Mr Ricchiuto warned that as more analysts come to terms with the Fed’s strong commitment to controlling inflation, Wall Street’s corporate earnings prospects could further weaken and push stock prices further.

However, there are also sparks of optimism. On Monday,

JPMorgan Chase

I said US consumers seem to be in good financial health. But that optimistic portrayal was quickly offset by the disclosure of one company, Snap. has never given an income warning before.

“We’re going to be on this roller coaster ride for a while as investors hold on to more optimistic data points and are newly disappointed when another negative reading comes in,” said Susannah Streeter, senior investment and market analyst at Hargreaves Lansdown. “We don’t yet know the exact path of interest rate hikes or how resilient consumers will be,” he said.

Despite Tuesday’s broad tech sales, there were bright spots in the market.

Zoom Video Communication

up 4.6% after the video conferencing services company snow has increased.

Tuesday’s divestment in tech stocks got investors into the scoop on government bonds, with the benchmark 10-year U.S. Treasury yield falling to 2.736% from 2.857% on Monday. A bond’s yield falls when its price rises.

Gold, considered another port asset, rose 0.9% to $1,864.70.

Traders worked on the floor of the New York Stock Exchange on Monday.


Spencer Platt/Getty Images

Brent crude, the international benchmark for oil, was roughly flat at $113.48 per barrel.

“There’s this push and pull with oil prices – oil prices are being held somewhat low by global growth, which is not a great indicator for the health of the global economy,” Ms Streeter said. But at the same time, it is not falling any further due to concerns about tight supply.”

In Europe, the intercontinental Stoxx Europe 600 lost 1.1%. In Asia, Hong Kong’s Hang Seng index fell 1.7%. Japan’s Nikkei 225 fell 0.9% and China’s Shanghai Composite Index fell 2.4%.

Write to Caitlin McCabe at and to Matt Grossman at

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