The major averages declined on Monday after stocks accumulated further losses after a sharp sell-off in technology stocks and North Korea’s foreign minister ramps up confrontation saying today that President Trump’s UN comments were “a declaration of war”. The Dow fell 53 points or -0.24%, Nasdaq dropped 56 points or -0.88% and the S&P 500 slid -5 points or -0.22%.
The tech sector was the biggest drag on the index down -1.50% and outweighing gains in energy up +1.50% and telecoms (+0.94%). Apple shares down -1.07% and Microsoft down -1.67% put pressure on the blue chip index.
Energy companies, Exxon Mobil up +1.33% and Chevron up +0.65% saw a surge on higher oil prices and a potential curtailment of supply after Turkey threatened to “close the valves” on Iraqi oil exports. General Electric went up +1.23%.
- Dow 22,296.09 -0.24%
- S&P 500 2,496.66 -0.22%
- Nasdaq 6,370.59 -0.88%
- Russell 2000 1,451.39 +0.04%
- NYSE Composite 12,140.97 -0.09%
- Gold 1,314.1 +1.28%
- Oil WTI $52.20 +3.06%
- 10-Year Treasury 2.21 -0.03%
Meanwhile, US government bonds strengthen as both North Korea tensions and the Germany election outcome with Chancellor Angela Merkel's Christian Democrats emerging as the victorious party but with a reduced share rattled investors, prompting demand for traditional safe haven assets. Gold was up +1.28% to above $1,300 per ounce.
The dollar is strengthening against expectation of a Federal Reserve rate rise this year. The euro fell -0.8% against the dollar to $1.1847. Yields and bond prices move inversely. The benchmark 10-Year Treasury yield was down three basis points to 2.21%.
Tech stocks a' drubbing
Investors sloughed off shares in the technology sector on Monday. On the tech-heavy Nasdaq, other big tech stocks dominating also faced losses with Facebook slumping -4.50%, Amazon shed 15 points or -1.60% and Netflix fell -4.70%.
Apple continues to be dogged by its iPhone 8 supply troubles. News reports suggest weak demand point to potentially lackluster sales for the new model.
However, experts suggest the slow uptake could be a positive sign and an indication of more interest in its iPhone X model due in November.