Stock market today: Tumbling tech stocks drag Wall Street to the finish line of another losing week
NEW YORK — The worst week for big technology stocks since the COVID crash in 2020 dragged Wall Street on Friday across the finish line of another losing week.
The S&P 500 dropped 0.9% to close out its third straight losing week. That’s its longest such streak since September, before it broke into a romp that sent it to a string of records this year.
The Nasdaq composite sank 2%. The Dow Jones Industrial Average, which has less of an emphasis on tech, was an outlier and rose 211 points, or 0.6%.
The market’s worst performers included several stocks that had been its biggest stars. Super Micro Computer lost more than a fifth of its value, dropping 23.1%. The company, which sells server and storage systems used in AI and other computing, had soared nearly 227% for the year coming into the day.
Nvidia, another stock that has surged to dizzying heights due to Wall Street’s frenzy around artificial-intelligence technology, also gave up some of its big recent gains. It slumped 10% and was the heaviest single weight on the S&P 500, by far, because of its huge size.
Tech stocks in the S&P 500 broadly lost 7.3% this week for their worst performance since March 2020 as some global giants reported discouraging trends. ASML, a Dutch company that’s a major supplier to the semiconductor industry, reported weaker-than-expected orders for the start of 2024, for example. The larger threat was a dawning, dispiriting acknowledgement sweeping Wall Street that interest rates may likely stay high for longer.
Top Fed officials said this week that they could hold interest rates at their high level for a while. That’s a letdown for traders after the Fed had signaled earlier that three cuts to interest rates could be possible this year.
High rates hurt prices for all kinds of investments. Some of the hardest hit tend to be those seen as the most expensive and which make investors wait the longest for big growth, which can make tech stocks vulnerable.
Lower rates had earlier appeared to be on the horizon after inflation cooled sharply last year. But a string of reports this year showing inflation has remained hotter than expected has raised worries about stalled progress.
Fed officials are adamant that they want to see additional proof inflation is heading down toward their 2% target before lowering the Fed’s main interest rate, which is at its highest level since 2001.
Traders are now largely forecasting just one or two cuts to rates this year, according to data from CME Group, down from expectations for six or more at the start of the year.
