Tech stocks pull market sharply lower
A steep, late-afternoon sell-off in technology companies pulled U.S. stocks sharply lower Tuesday, knocking 344 points off the Dow Jones industrial average.
The market slide erased modest gains from earlier in the day and much of a powerful rally from the day before.
Banks also weighed on the market as bond yields declined. Investors bid up shares in safe-play stocks like utilities and real estate companies.
The market turbulence came a day after the major stock indexes notched their best day in more than two years following a steep slide last week.
"Just looking at the sector performance indicates to me this is a flight-to-safety kind of trade day," said Sam Stovall, chief investment strategist at CFRA. "Until we get better guidance as to whether this correction is truly over, we will take a very choppy rise possibly to new highs a few months down the road."
The Standard & Poor's 500 index fell 45.93 points, or 1.7 percent, to 2,612.62. The Dow tumbled 344.89 points, or 1.4 percent, to 23,857.71. The 30-company average had been down 493 points. A day earlier, it climbed 669 points.
The tech-heavy Nasdaq slid 211.74 points, or 2.9 percent, to 7,008.81. The Russell 2000 index of smaller-company stocks gave up 30.15 points, or 2 percent, to 1,513.57.
The major stock indexes appeared headed for more gains early Tuesday after their strong finish on Monday, but the rally didn't last. Stocks wavered through much of the morning, recovered somewhat by early afternoon, but then veered sharply lower as investors sold shares in Nvidia, Twitter, Facebook and other technology companies.
Nvidia tumbled more than any other stock in the S&P 500 on published reports that the company has temporarily stopped testing its technology for self-driving cars in the wake of a deadly collision last week in Tempe, Arizona, involving an Uber autonomous vehicle and a pedestrian. The chipmaker's shares lost $18.96, or 7.8 percent, to $225.52.
Microsoft, which outgained all the other companies in the S&P 500 Monday, gave up $4.31, or 4.6 percent, to $89.47.