The Nasdaq composite led the stock market lower Tuesday afternoon, though the selling certainly wasn’t limited to that index.
The S&P 500 lost 0.4% and the Dow Jones industrial average 0.2% as indexes traded near session lows. The small-cap Russell 2000 was down 0.4%.
Volume was higher on the NYSE and lower on the Nasdaq compared with the same time Monday. Losers led winners by 9-to-7 across the board.
Chip stocks and related industries, such as contract manufacturers of electronics, were in full retreat. Those group were down 1.7% to 2.3%.
Three tech stocks fell below the 50-day moving average, and in each case it was the first time they violated that price indicator in many months.
Lam Research (LRCX) this week is closing below the 50-day line for the first time since November. Applied Materials (AMAT) dipped below the 50-day line for the first time since the September-November basing period. Coherent (COHR), a laser technology company, had not fallen below the line since November also.
None of the moves amounted to a sell signal, and they came in mild volume. Nonetheless, they mark a change in the stocks that may lead to a longer change in direction.
In the internet sector, Grubhub (GRUB) triggered a sell rule after it fell more than 8% below the buy point. The stock has not been able to shake off sellers that swarmed after Morgan Stanley downgraded the stock Monday.
Biotechs also contributed to the Nasdaq’s slide. ProShares Ultra Nasdaq Biotech (BIB), an ETF that doubles the performance of its underlying index, dropped nearly 4% and was one of the most active stocks in today’s market.
Financials were doing better, as were energy and some other industry groups in the lower reaches of the performance table.