Wall Street’s main indexes fell on Friday as major technology-related stocks fell, repulsed by the Federal Reserve’s decision to sharply end its pandemic-era stimulus.
An announcement from the Fed this week hinted at a three quarter-percentage-point interest rate hike by the end of 2022 to put pressure on heavyweight tech stocks to tackle rising inflation.
Growth stocks including Apple Inc, Meta Platforms, Amazon.com Inc and Microsoft Corp fell between 0.5% and 1.2%.
Nine of the 11 major S&P 500 sector indexes fell in early trade, with technology stocks weighing 0.9% on the benchmark index.
Value-oriented sectors including financials and energy, which jumped after the Fed’s announcement, fell more than 2% each.
“It was clearly a hawkish (Fed) meeting on Wednesday, no two ways about it,” said Thomas Hayes, managing member of Great Hill Capital LLC in New York.
“Many people who came into high liquidity positions or hedged against technology took a sigh of relief or covered their shorts in the short term if the Fed was bullish than expected.”
The Nasdaq index is now set to end the week lower by 3.6%, while the S&P 500 is down nearly 2%.
Still, most heavyweight growth stocks have outperformed the broader market in 2021, with the Philadelphia SE Semiconductor Index up nearly 35%. The benchmark S&P 500 index rose 23% in the same period.
Global stocks also backed down on Friday over concerns about the fast-spreading Omicron version of the coronavirus, which has weighed on global trading sentiment since late November.
At 9:58 am, the Dow Jones Industrial Average was down 508.31 points, or 1.42%, at 35,389.33, the S&P 500 was down 48.97 points, or 1.05%, at 4,619.70 and the Nasdaq Composite was down 117.80 points, or 0.78%. , at 15,062.63.
Simultaneous expiration of stock options, stock index futures and index options contracts later in the day, known as triple witching, is expected to create volatility during the trading session.
Oracle fell 5.2% after a report said the enterprise software maker is in talks to buy electronic medical records company Cerner in a deal that could be valued at $30 billion. Shares of Cerner were up 12.9%.
FedEx Corp rose 7.3% on Thursday after the delivery firm reinstated its original fiscal 2022 forecast, even as a persistent labor crisis snarled profits. Shares of Peer United Parcel Service also gained 0.9%.
The decline issues to a 3.62-to-1 ratio on the NYSE and a 2.71-to-1 ratio on the Nasdaq.
The S&P index recorded 16 new 52-week highs and five new lows, while the Nasdaq recorded five new highs and 266 new lows.
This story has been published without modification in text from a wire agency feed.
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