Tech Stocks Weigh on Wall Street

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Tech Stocks Weigh on Wall Street[embedded content]

By Reuters

July 27, 2018

NEW YORK — Wall Street’s major indexes were lower on Friday as weak earnings reports from major technology companies weighed on the sector.

Intel Corp shares sank 8.7 percent after the chipmaker’s data center business missed estimates amid stiff rivalry from Advanced Micro Devices Inc. AMD shares rose 1.6 percent.

Twitter Inc shares plunged 19.1 percent after the social media network reported a decline in monthly active users, versus the increase analysts had expected, and warned of further drops as it deletes phony accounts.

The S&P 500 technology index fell 2.2 percent, the most among the major S&P sectors. Shares of Apple Inc, which is set to report quarterly results on Tuesday, fell 1.9 percent. Shares of Microsoft Corp and Alphabet Inc, which had soared after both companies recently reported strong quarterly results, dropped 2.0 percent and 2.7 percent, respectively. Earlier in the day, Alphabet shares hit a record high.

The pressure on tech stocks started on Thursday when Facebook Inc gave a dismal forecast that caught investors off guard about growth prospects in a sector that has led the market’s march toward record highs.

“These have been absolutely high-flying stocks, white-hot,” said Chad Morganlander, portfolio manager at Washington Crossing Advisors in Florham Park, New Jersey. “Any deceleration in performance applies tremendous pressure to the group….It forces the market to take a breather.”

The Dow Jones Industrial Average fell 98.19 points, or 0.38 percent, to 25,428.88, the S&P 500 lost 22.56 points, or 0.80 percent, to 2,814.88 and the Nasdaq Composite dropped 126.72 points, or 1.61 percent, to 7,725.46.

The Nasdaq was on pace for its biggest daily percentage drop since June 25, a day after registering its greatest one-day percentage decline in a month.

Intel and Twitter’s disappointing results overshadowed data from the Commerce Department that

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