Wall Street Close: Nasdaq drops the most in seven weeks on tech sell-off
|- US equities closed mixed as DJI30 marked corrective pullback.
- Apple led technology giants’ south-run, Yellen confused traders.
- US ISM Services PMI, ADP Employment Change data will be important.
Wall Street benchmarks closed mixed on Tuesday despite the downpour of the technology shares, led by Apple’s over 3.0% drop. The reason could be traced from the Dow Jones Industrial Average’s (DJI30) corrective pullback following US Treasury Secretary Janet Yellen’s U-turn on rate signals.
Having initially backed the interest rate hike and dragged down the US equities, Yellen reversed her moves while saying, “not predicting or recommending” interest rate increase. Her comments helped the DJI30 to print mild gains but couldn’t save the market players as Nasdaq and S&P 500 closed on the negative side.
That said, DJI30 gains 0.06% or 19.8 points to close around 34,133. On the contrary, S&P 500 declined 0.67%, or 28 points, while Nasdaq became the day’s biggest loser with a 1.92% downside to flash one-month low before closing around 13,530.
Shares of Apple, Amazon, Microsoft and Alphabet all dropped with the first being the leader in the south-run as downbeat US trade figures and factory orders joined rate hike signals to weigh the technology shares.
Other than the risk and data factors, comments from the International Monetary Fund (IMF), backing the “Global minimum corporate tax rate” also weighed on the multinational companies and drowned the markets.
Alternatively, the coronavirus (COVID-19) woes battled upbeat vaccine developments and mixed earnings from the key drug manufacturers, like Pfizer, also troubled traders.
Amid these plays, US 10-year Treasury yields dropped 1.5 basis points (bps) while the US dollar index (DXY) gained 0.35% by the end of Tuesday’s North American trading.
Moving on, downbeat prints of US ISM Manufacturing PMI pushes investors to keep their eyes on the ISM Services PMI for April for immediate direction. Also important is the early signal for Friday’s job report, ADP Employment Change for April.
Read: US ISM Services PMI April Preview: Inflation readings remain key as recovery gains strength
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