Wall Street slips on tech shares sell-off

GM slips after cutting 2017 sales forecast; Sprint rose 5.8% on wireless partnership talk

Wall Street was pulled lower by a sell-off in technology shares at the open yesterday, while investors awaited clues on interest rate hikes from Federal Reserve Chair Janet Yellen’s talk in London.

The technology index fell 0.7 per cent due to a drop in the shares of Apple, Microsoft and Alphabet. Alphabet fell 1.2 per cent to $960.55 (Dh3,528) after EU antitrust regulators hit the tech giant with a record $2.7 billion fine.

The tech sector has been under pressure over concerns about lofty valuations, with investors shifting to high-dividend paying defensive sectors such as utilities in a rising interest rate environment.

The technology index has jumped about 19 per cent since the beginning of the year and has been the major force behind the S&P’s record-setting rally. “The indices continue to hover near the very high end of the recent ranges, suggesting this week’s end-of-the-quarter window dressing is likely to see more sector rotation,” Peter Cardillo, chief market economist at First Standard Financial, wrote in a note.

Yellen was scheduled to take part in a discussion on global economic issues in London at 1pm ET (1700 GMT). Investors expected Yellen to offer more insight into the state of the US economy, which would support the Fed’s forecast of a rate hike this year.

Sprint rises

Sprint rose 5.8 per cent to $8.47 after the fourth-largest US wireless service provider was said to be in talks with Charter Communications Inc and Comcast Corp about a wireless partnership. Comcast was down 1.2 per cent while Charter was little changed.

T-Mobile was down 5 per cent at $60 after Reuters reported that Sprint had put its merger talks with the company on hold.

General Motors slipped 0.5 per cent to $34.34 after the automaker lowered its outlook for new sales in 2017. Fiat Chrysler fell 1 per cent, while Ford was flat.