Tech stocks drag Nasdaq into losses for the year

(Reuters) – Shares in U.S. technology majors sank again on Monday, wiping out the tech-heavy Nasdaq index’s gains for the year and sending the benchmark S&P 500 below a closely watched technical level for the first time in nearly two months.

FILE PHOTO – Traders work on the floor of the New York Stock Exchange (NYSE) in New York, U.S., March 29, 2018. REUTERS/Brendan McDermid

All the 11 major S&P sectors were lower, with stocks also coming under pressure over renewed fears of a trade war after China imposed additional tariffs on 128 U.S. products.

Amazon (AMZN.O) dropped nearly 5 percent after President Donald Trump launched his latest attack over the pricing of the retailer’s deliveries through the U.S. postal system and promised unspecified changes.

Facebook (FB.O) was down 2.6 percent, while the other ‘FANG’ constituents Netflix (NFLX.O), Google-parent Alphabet (GOOGL.O) were down between 2.5 percent and 4.4 percent. The technology index .SPLRCT was down 2.7 percent.

Tesla (TSLA.O) shares shed about 7 percent ahead of the electric car maker’s announcement of quarterly production numbers for its crucial Model 3 sedan.

“There’s also a kind of negative tone over the market, the S&P is getting crushed,” said Ken Polcari, Director of the NYSE floor division at O’Neil Securities in New York.

“Tesla is a high-flying growth name and growth names are getting slaughtered in the past month or so. “Makes sense that those names will be under more pressure than the broader markets.”

At 11:50 a.m. EDT the Dow Jones industrial average .DJI was down 449.49 points, or 1.86 percent, at 23,653.62.

The S&P 500 .SPX was down 57.28 points, or 2.17 percent, at 2,583.59, falling below its 200-day moving average for the first time since during a market sell-off in early February.

The Nasdaq Composite .IXIC was down 189.51 points, or 2.68 percent, at 6,873.94. The index was down 0.37 percent for the year.

“What you’re seeing in the market is a change in leadership, it happened at the end of last month where you had tech starting to do not so well,” said Thomas Martin, senior portfolio manager at Globalt Investments in Atlanta, Georgia.

“…That’s happening again today as market participants are thinking, ‘Is this the change in leadership and what should we do about it?’”

Among the few bright spots, Humana (HUM.N) jumped about 5.3 percent Reuters reported Walmart (WMT.N) was in early-stage talks with the health insurer about developing closer ties, with acquisition discussed as one possibility.

Walmart fell more than 2 percent. UnitedHealth (UNH.N) jumped 2.4 percent, one of only two Dow Industrials trading higher in the session.

Declining issues outnumbered advancers on the NYSE by a 4.03-to-1 ratio. On the Nasdaq, a 4.17-to-1 ratio favored decliners.

The S&P 500 index showed two new 52-week highs and 20 new lows, while the Nasdaq recorded 36 new highs and 120 new lows.

Reporting by Sruthi Shankar in Bengaluru; Editing by Sriraj Kalluvila

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