Weakness in Big Tech leads stocks lower in morning trading

Author: Damian J. Troise / AP
FILE – This Nov. 23, 2020 file photo shows the New York Stock Exchange in New York. Stocks are opening lower on Wall Street Tuesday, Sept. 28, 2021, led by more declines in Big Tech companies. (AP Photo/Seth Wenig, File)

Stocks fell broadly in morning trading on Wall Street Tuesday as bond yields continued marching higher and put more pressure on big technology companies.

The S&P 500 fell 1.4% as of 10:10 a.m. Eastern. The Dow Jones Industrial Average fell 350 points, or 1%, to 34,519 and the Nasdaq fell 2%.

Bond yields continued rising. That tends to draw money out of sectors like technology with lofty valuations. The yield on the 10-year Treasury rose to 1.55%, the highest since late June. It was at 1.48% late Monday.

Chipmaker Nvidia fell 3.7% and Microsoft fell 2.6%. The broader technology sector has also been contending with a global chip and parts shortage because of the virus pandemic and that could get more severe as a power crunch in some parts of China shuts down factories.

Communications companies also weighed down the market. Facebook fell 3.3% and Google’s parent company, Alphabet, fell 3.7%.

Energy stocks rose. Exxon Mobil rose 1.6% and Cabot Oil & Gas rose 1.3%.

Another lingering market worry resonating from China is the possible collapse of one of China’s biggest real estate developers. Evergrande Group is struggling to avoid a default on billions of dollars of debt.

Markets in Asia were mixed while markets in Europe fell.

Investors have been dealing with a choppy market in September as they try to gauge how the economic recovery will progress and how it will impact various industries. The S&P 500 is down 3.3% so far in September and is headed for its first monthly loss since January.

COVID-19 remains a lingering threat and is still taking its toll on businesses and consumers. Economic data on consumer spending and the employment market has been mixed. Companies are warning that supply chain problems and higher prices could crimp sales and profits.

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