The stock market declined for the second consecutive session on Tuesday, with significant technology companies like Apple leading the broad market downturn from recent record highs.
The Nasdaq Composite fell by 1.65% to 15,939.59 as technology stocks were hit hardest by the market’s retreat. The Dow Jones Industrial Average ended the day 404.64 points lower, a decrease of 1.04%, at 38,585.19. The S&P 500 saw a decrease of 1.02%, closing at 5,078.65.
Apple Drops 3%, Tech Giants Stumble
Apple’s stock dropped nearly 3% following a Counterpoint Research report indicating a significant decline in iPhone sales in China during the first six weeks of 2024.
Other major technology stocks, including Netflix and Microsoft, also experienced declines of close to 3%, while Tesla’s shares fell by nearly 4%. The information technology sector of the S&P 500 was the primary driver of the index’s overall loss, with a downturn of more than 2%.
Beyond the large-cap tech stocks, GitLab saw a dramatic 21% fall after the software company projected a weaker full-year forecast. Intel and Salesforce stood out as the Dow’s poorest performers, each with a decline of more than 5%.
Scott Ladner, CIO at Horizon Investments, reflected on the tech sector’s challenges, noting, “The taller they grow, the harder they fall. Today’s sell-off targets the sectors that have shown strong performance throughout the year.”
MicroStrategy Dives 13%, Markets Wary
MicroStrategy’s shares plunged 13.1% after the company announced plans to raise $600 million in debt to purchase more bitcoin and for general corporate uses. Bitcoin’s value briefly soared above $69,000 before dipping below $63,000, partly driven by new exchange-traded funds offering easier cryptocurrency access.
Target contributed to mitigating the market’s overall losses, surging 12.7% following a report of earnings exceeding expectations for the end of 2023. New York Community Bancorp also saw a significant rise of 15.7%, recovering some losses from the previous day connected to commercial real estate investments.
A report indicating slower growth in the U.S. construction and healthcare services sectors last month fueled hopes for potential interest rate cuts. It also showed a deceleration in service business price increases in February compared to January, alongside weaker-than-expected U.S. factory orders in January.
Investors await Federal Reserve Chair Jerome Powell’s forthcoming testimony before Congress for additional insights on the timing of rate cuts. In bond markets, the yield on the 10-year Treasury note declined to 4.14% from 4.22% on Monday.
Globally, Hong Kong’s Hang Seng index dropped 2.6% following China’s premier setting this year’s economic growth target at around 5%. Meanwhile, stocks in Shanghai slightly rose by 0.3%, with most other world indices experiencing modest declines.
