US STOCKS-Tech stocks tumble, backing Wall St away from highs – Reuters

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* Apple, Microsoft, Alphabet all fall sharply

* Gains in financials, energy help counter broader declines

* Indexes down: Dow 0.08 pct, S&P 0.65 pct, Nasdaq 2.6 pct
(Updates to late afternoon)

By Lewis Krauskopf

June 9 Technology stocks sold off on Friday,
wounding the Nasdaq and holding down other major Wall Street
indexes, which had touched record highs earlier in the session.

The technology sector, which has soared this year
and led the market’s rally, dropped 3.6 percent.

Apple shares fell 4.8 percent and were the biggest
weight on the three major indexes, after a report that upcoming
iPhones launched will use modem chips with slower download
speeds than some rival smartphones.

Microsoft, Facebook and Alphabet
all were off more than 3 percent, while chipmaker Nvidia
traded down 8.8 percent at $147.60 after Citron
Research said the stock could trade back to $130.

Shares of software company Cloudera tumbled 16.7
percent after its earnings report.

“Tech has been on a tear for a very, very long period of
time,” said John Praveen, managing director for Prudential
International Investments Advisers in Newark, New Jersey, adding
that investors may be using the earnings report as “an excuse to
take some profits.”

The Dow Jones Industrial Average fell 17.02 points,
or 0.08 percent, to 21,165.51, the S&P 500 lost 15.88
points, or 0.65 percent, to 2,417.91 and the Nasdaq Composite
dropped 166.89 points, or 2.64 percent, to 6,154.87.

Countering tech’s slide, financials rose 1.4 percent
and energy shares gained 2.3 percent as oil prices moved

Investors were also digesting major political and economic
events this week in the United States and Europe.

U.S. stocks had started the session strong after the results
of the UK election, where British Prime Minister Theresa May’s
Conservative Party lost its parliamentary majority.

Investors also viewed former FBI Director James Comey’s
testimony on Thursday as not damaging enough to Donald Trump’s

Market watchers were concerned result of the Congressional
hearing could derail Trump’s plans for lower taxes, fiscal
spending and looser regulations, which have helped drive the S&P
500 up more than 13 percent since his election.

Focus was turning to the Federal Reserve’s meeting next
week, when the U.S. central bank is overwhelmingly expected to
raise interest rates.

“Markets are probably expecting that the Fed will raise
rates, but they will be very gradual in removing monetary
accommodation,” Praveen said.

Advancing issues outnumbered declining ones on the NYSE by a
1.50-to-1 ratio; on Nasdaq, a 1.01-to-1 ratio favored advancers.

(Additiona reporting by Tanya Agrawal and Yashaswini
Swamynathan in Bengaluru; Editing by Nick Zieminski)