© Reuters. Traders work on the floor of the NYSE in New York
By Shreyashi Sanyal
(Reuters) – Wall Street was hammered on Wednesday as investors dumped high-growth names such as technology and FAANG stocks, with rising Treasury yields and trade-related worries sapping their risk appetite.
The benchmark S&P 500 and the Dow Jones Industrial Average fell nearly 1.5 percent and at the day’s low had retreated 3.7 percent and 4.5 percent, respectively, from their all-time highs. The Nasdaq’s 2-percent drop pulled it 7.8 percent away from its high.
All three indexes hit records between Aug. 30 and Oct. 3, despite the escalating Sino-U.S. trade dispute gnawing at confidence on corporate profit growth through most of the year.
But a recent IMF warning on global growth taking a hit from trade disputes has hit confidence in the stock market, as has U.S. Treasury yields at more than 7-year highs, signaling a tightening of capital globally.
“It’s a risk-off environment as investors are focusing on spiking yields and taking profits off the table as they are concerned about whether the bull market is actually coming to an end,” said Ryan Nauman, market strategist at Informa Financial Intelligence in Zephyr Cove, Nevada.
The retreat on Wall Street was led by technology stocks (), which dropped 2.33 percent, and the trade-sensitive industrial stocks () that fell 2.22 percent.
Along with tech stocks, the FAANGs – Facebook (O:), Amazon (O:), Apple (O:), Netflix (O:) and Alphabet (O:) – have led the market rally. The FAANGs, spread over three sectors, were down between 1.4 percent and 5.4 percent.
“If investors are going to take profits then it will be from some of the bigger, high-growth names,” Nauman said.
At 12:22 a.m. ET the Dow () was down 343.04 points, or 1.30 percent, at 26,087.53, the