Stocks fall further amid tech sell-off
U.S. stock indexes slipped again Monday as technology firms, which were near record highs last week, suffered a second day of sharp losses. Investors are changing course and selling some of the best-performing stocks of the year while buying shares of companies that have struggled.
Tech firms have surged in recent months, and Monday almost all the losses came from the big companies that have led the way recently: Apple, Microsoft, Facebook and Alphabet, Google’s parent company.
Julian Emanuel, an equity strategist for UBS, thinks tech stocks may fall further and wind up 10% lower than they were last week. He said the tech firms should continue to do well, but the stocks have done so well lately, they are due for a downturn.
“Any time that you have that degree of extreme sector outperformance, two things happen: The overall market tends to get a bit more volatile, and the leading group tends to underperform the laggards,” he said.
Investors took a new look at some groups of companies that haven’t done that well in 2017, including energy, telecommunications and real estate firms. Some of the best-performing stocks fell, including consumer-focused companies, healthcare companies, utilities and basic materials makers.
Apple dropped 2.5% to $145.32, Alphabet fell 0.9% to $961.81, Facebook fell 0.8% to $148.44, and Microsoft fell 0.8% to $69.78. Other 2017 top performers also tumbled: Activision Blizzard sank 2.2%, and Netflix dived 4.2%.
Trovagene jumped 20% to 97 cents after the San Diego developer of diagnostic tech announced a deal to provide Astra-Zeneca with a urine biomarker test and services for use in a study.
Benchmark U.S. crude rose 25 cents to $46.08 a barrel. Brent crude rose 14 cents to $48.29 a barrel. Exxon Mobil shares rose 1% to $82.93, and Chevron ticked up 1.5% to $108.04.
Energy firms are down 12% this year and phone companies have fallen almost 9%, but both climbed Monday. Real estate firms have lagged the market this year, and they rose too.
Stocks that took a rare downturn included Amazon, which fell 1.4% to $964.83, and Baxter International, down 3% to $57.15.
Bond prices fell. The yield on the 10-year Treasury note rose to 2.21% from 2.20%.
Wholesale gasoline slipped 1 cent to $1.49 a gallon. Heating oil fell less than 1 cent to $1.43 a gallon. Natural gas fell 2 cents to $3.02 per 1,000 cubic feet.
The dollar fell to 109.79 yen from 110.20 yen. The euro rose to $1.1208 from $1.1195.
Gold fell $2.50 to $1,268.90 an ounce. Silver fell 28 cents to $16.94 an ounce. Copper fell 3 cents to $2.62 a pound.