Tech selloff pulls Wall Street to two-week lows as bond yields climb
Wall Street witnessed a significant selloff, plunging to two-week lows on Tuesday, as bond yields climbed to multi-year peaks. The S&P 500 and Nasdaq Composite both declined, led by the tech sector, particularly semiconductors. The Philadelphia SE Semiconductor Index plummeted over 5%. Investors reacted to higher bond yields, fearing increased borrowing costs and questioning the Federal Reserve's loose monetary policy.
Tony Welch, chief investment officer at SignatureFD, noted that rising interest rates significantly impacted momentum-driven stocks. The Dow Jones Industrial Average slipped 0.15%, the S&P 500 dropped 0.56%, and the Nasdaq Composite fell 1.22%. The tech sector, especially Nvidia, suffered heavy losses, with Nvidia's stock declining over 2%.
Other hard-hit sectors included data storage firms, Western Digital, and Micron Technology. Defensive sectors like healthcare and consumer staples saw gains. Energy stocks rose, buoyed by higher oil prices, nearing all-time highs. The S&P 500 energy sector rose 1.7%, slightly above its previous peak.
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