US tech stocks dive into negative territory for 2018 amid trade-war fears

Sergio Guzman of Mexico dives from the 27 metre platform during the sixth and final stop of the Red Bull Cliff Diving World Series on October 21, 2017. Photo by Dean Treml/Red Bull via Getty Images
  • US stocks saw deep losses Monday as President Donald Trump continued to publicly criticise Amazon and his administration prepares to roll out tariffs on Chinese imports.
  • Stocks in the technology, consumer discretionary, and energy sectors led major indexes lower.
  • Follow the Dow Jones industrial average and Nasdaq 100 index.

US stocks tumbled Monday as President Donald Trump doubled down on his criticism of Amazon, sending shares in the technology and consumer discretionary sectors lower.

The selling also comes ahead of the Trump administration’s plan to unveil this week a list of Chinese imports targeted for US tariffs. The list of $US50 billion to $US60 billion worth of annual imports is expected to target “largely high-technology” products.

The more tech-heavy Nasdaq 100 – which has been a lightning rod for market volatility in recent weeks – plummeted as much as 3.9% to lead all major US indexes. Meanwhile, the benchmark S&P 500 dropped as much as 3.3%, and the 30-company Dow Jones industrial average at one point slid more than 3.1%, or 759 points.

The S&P 500 also closed below its 200-day moving average, a key technical level that, when breached, could signal further selling ahead for the gauge.

Among the worst-hit technology firms were chipmakers, including Lam Research, Micron Technology, Nvidia, Intel, and Cisco, which all dropped at least 3.9%. Because of their position in supply chains, these firms are more vulnerable to geopolitical turmoil, particularly as it pertains to China.

Mega-cap technology companies also took a dive as the New York Stock Exchange’s FANG+ Index – which includes Facebook, Amazon, Netflix, Google, and six other massive global firms – decreased 4.1%. Amazon, Netflix, and Tesla all logged losses exceeding 5.1%.

Tech-sector woes are mounting at a time when it seems everything is going wrong simultaneously for the industry. Netflix shares are falling deeper into a correction in the wake of a recent data breach, while Tesla is under pressure ahead of its quarterly production update for the Model 3 sedan.

Check out Business Insider’s in-depth coverage of the market’s recent turbulence:

Elsewhere in global equity markets, the Shanghai Composite lost 0.2% after climbing as much as 0.7% in early trading, while the Stoxx Europe 600 increased 0.4%.

In the bond market, the 10-year US Treasury yield fell one basis point, to 2.73%, close to the key 3% level that traders are closely watching. Bank of America Merrill Lynch has said a trade war could move yields higher in the medium-to-long term.

Here’s a rundown of other asset classes: