Tech shares pull U.S. stocks lower

U.S. stocks notched their second decline in as many days Wednesday, pulled down by a technology stock slump headlined by Apple and Microsoft.

Both companies delivered disappointing quarterly results or outlooks the night before, setting the stage for the sell-off in the technology sector.

“Apple is the biggest publicly traded company in the world, so it’s going to have a big impact on the indices,” noted Erik Davidson, chief investment officer at Wells Fargo Private Bank.

The slide wasn’t that broad, however. Financial and utilities stocks were among the big gainers. And home builders got a boost from a report indicating U.S. home sales surged last month to the fastest pace in more than eight years.

The Dow Jones industrial average slid 68.25 points, or 0.4%, to 17,851.04. The Standard & Poor’s 500 index lost 5.06 points, or 0.2%, to 2,114.15.

The Nasdaq composite shed 36.35 points, or 0.7%, to 5,171.77. The tech-heavy index, which hit a new high Monday, remains the bestperforming index for the year. It’s up 9.2%, while the S&P 500 is up 2.7% and the Dow is essentially flat.

Five of the 10 sectors in the S&P 500 index declined, led by a 1.6% drop in technology stocks. Financials led the gainers, rising 0.7%.

The major stock indexes declined from the get-go as traders reacted to weaker showings late Tuesday from Microsoft, Yahoo and Apple.

Yahoo posted a nearly $22 million loss driven by soaring commissions paid to its partners and flat sales. The stock slipped 49 cents, or 1.2%, to $39.24.

Microsoft’s slide was more pronounced at 3.7%. The company reported a hefty quarterly loss stemming from an expense of $8.4 billion related to its purchase of the Nokia phone business over a year ago. The stock lost $1.74 to $45.54.

Apple fared the worst, shedding 4.2% after management gave a cautious outlook for the current quarter and didn’t provide much detail on how the company’s new smartwatch was doing. Apple’s latest results also stirred investor concerns about a slowdown in the growth of iPhone sales. The stock fell $5.53 to 125.22.

The price of oil closed below $50 for the first time since April after the government reported a surprise increase in crude inventories.

Oil inventories typically shrink this time of year because demand is high, and analysts had expected a decline of 1.9 million barrels, according to Platts.

Instead, crude supplies increased by 2.5 million barrels, according to the Energy Information Administration.

Benchmark U.S. crude fell $1.67 to close at $49.19 a barrel in New York.