Tech stocks took a hit on Wall Street on Wednesday, leading to the S&P 500’s fourth consecutive loss. The index fell 0.6% to 5,022.21, marking its longest losing streak since early January. The Dow Jones Industrial Average also slipped 0.1% to 37,753.31, while the Nasdaq composite sank 1.1% to 15,683.37.
The decline in tech stocks was triggered by ASML, a Dutch semiconductor supplier, reporting weaker orders for the start of 2024 than expected. This news caused ASML’s stock to plummet by 7.1%. Nvidia and Broadcom also saw drops of 3.9% and 3.5%, respectively, weighing heavily on the S&P 500.
Despite some positive profit reports from companies like United Airlines, which saw a 17.4% surge in its stock after reporting strong results, the overall market sentiment was dampened by the tech sector’s performance.
The bond market, which has been influencing Wall Street’s movements, saw some relief as oil prices fell, easing concerns about inflation. This led to a decrease in Treasury yields, with the 10-year yield dropping to 4.58% from 4.67%.
Federal Reserve officials have hinted at keeping interest rates steady for the time being to monitor inflation trends. This has caused traders to lower their expectations for interest rate cuts, with most now anticipating only one or two cuts this year.
With interest rates expected to remain stable, companies will need to deliver strong profits to justify their stock prices. Market analysts are closely watching corporate news to gauge the market’s next move.
While some companies like Omnicom Group reported better-than-expected profits, others like Travelers and J.B. Hunt Transport Services fell short of forecasts, leading to declines in their stock prices.
In international markets, London’s FTSE 100 rose 0.4% following a report of lower UK inflation, potentially paving the way for interest rate cuts. Stock indexes in Europe and Asia showed mixed results, with Japan’s Nikkei 225 falling 1.3% and Shanghai stocks jumping 2.1%.
Overall, the market remains cautious as investors await further corporate earnings reports to determine the direction of Wall Street in the coming days.
