Tech stocks lead US indexes mostly lower in afternoon trade
A steep drop in technology companies pulled major U.S. stock indexes mostly lower in afternoon trading Wednesday. The slide offset gains by banks, which got a boost from rising bond yields, and health care stocks. Energy companies also fell as crude oil prices headed lower.
KEEPING SCORE: The Standard & Poor’s 500 index fell 1 point, or 0.1 percent, to 2,625 as of 12:45 p.m. Eastern Time. The Dow Jones industrial average gained 72 points, or 0.3 percent, to 23,909. The Nasdaq composite lost 83 points, or 1.2 percent, to 6,828. The Russell 2000 index of smaller-company stocks picked up 6 points, or 0.4 percent, to 1,542. Falling stocks outpaced rising ones on the New York Stock Exchange. The market is coming off its best day since September.
TECH TUMBLE: Amazon, Facebook, Google parent Alphabet and other big technology companies were giving up some of their recent gains. The sector is still by far the biggest riser this year, with a gain of 35 percent. Amazon dropped $ 37.09, or 3.1 percent, to $ 1,156.51. Facebook was off $ 6.61, or 3.6 percent, to $ 175.81. Alphabet fell $ 26.79, or 2.5 percent, to $ 1,036.50.
CHIPS ARE DOWN: Shares in several chipmakers slumped. Micron Technology slid $ 3.36, or 7 percent, to $ 44.57, while Applied Materials shed $ 3.83, or 7.8 percent, to $ 196.59. Lam Research declined $ 16.55, or 7.8 percent, to $ 196.59.
PINK SLIP SLIDE: Autodesk sank 20.1 percent after the design software company said it will eliminate 1,150 jobs, or about 13 percent of its current workforce. Autodesk said the cuts will cost $ 135 million to $ 149 million. The company had a disappointing third quarter and gave a weak forecast. The stock fell $ 20.12 to $ 109.83.
HEARTBREAK: Boston Scientific shares shed 1.9 percent after the company announced another delay for a heart valve system. The stock declined 50 cents to $ 23.90.
ENCOURAGING DATA: The Commerce Department estimated that the U.S. economy grew at an annual pace of 3.3 percent from July through September. That would be the fastest rate in three years. The new estimate helped lift bond yields. The yield on the 10-year Treasury rose to 2.38 percent from 2.34 percent late Tuesday. Meanwhile, the National Association of Realtors said that its pending home sales index surged 3.5 percent last month. “We’ve had some pretty decent economic news,” said CFRA Investment Strategist Lindsey Bell.
BANKS BUMPED UP: Banks and other financial stocks posted solid gains, getting a boost from rising bond yields. Banks benefit from rising bond yields because they can charge higher interest rates on loans. Citizens Financial Group climbed $ 1.73, or 4.5 percent, to $ 40.51.
NEW TOPPING: Chipotle Mexican Grill gained 3.1 percent after the restaurant chain said it is looking for a new CEO. The company is trying to recover from a sales slump following a series of food safety scares. Founder Steve Ells, who currently serves as chairman and CEO, will transition to executive chairman once someone new is in place at the top post. The stock gained $ 8.79 to $ 294.65.
ENERGY: Benchmark U.S. crude gave up $ 1.13, or 1.9 percent, to $ 56.86 a barrel on the New York Mercantile Exchange. Brent crude, used to price international oils, lost $ 1.13, or 1.8 percent, to $ 62.11 a barrel in London.
CURRENCIES: The dollar rose to 111.84 yen from 111.55 yen on Tuesday. The euro strengthened to $ 1.1860 from $ 1.1837. The pound rose to $ 1.3440 from $ 1.3373 on reports that the British government is closer to agreeing on a divorce bill with the European Union.
MARKETS OVERSEAS: Major European stock indexes were mixed. Germany’s DAX was flat, while the CAC 40 of France rose 0.1 percent. Britain’s FTSE 100 slid 0.9 percent. Earlier in Asia, Japan’s Nikkei 225 index gained 0.5 percent, while South Korea’s Kospi edged 0.1 percent lower. Australia’s S&P ASX 200 added 0.5 percent. The Hang Seng index in Hong Kong fell 0.2 percent. India’s Sensex slipped 0.1 percent, while shares in Southeast Asia were mixed.