A steep drop in technology companies sent U.S. stocks sharply lower Monday, knocking off more than 400 points from the Dow Jones Industrial Average. Banks and consumer-focused companies and media and communications stocks also took heavy losses. Crude oil prices were headed higher, snapping a 10-day skid, after Saudi Arabia said it planned to cut its output.
KEEPING SCORE: The S&P 500 index dropped 37 points, or 1.4 percent, to 2,742 as of noon Eastern Time. The Dow fell 427 points, or 1.6 percent, to 25,561. The Nasdaq composite slid 190 points, or 2.6 percent, to 7,216. The tech-heavy index now has a loss for the year. The Russell 2000 index of smaller companies fell 25 points, or 1.7 percent, to 1,523. Bond trading was closed for Veterans Day.
THE QUOTE: “Tech is definitely weighing (on the market),” said Lindsey Bell, investment strategist at CFRA. “The question really is growth. We continue to like tech going into next year, but we think it could be a little bit of a rocky period for the group as we continue through the last two months of the year.”
TECH TUMBLE: Losses in technology sector stocks led the market lower. Apple tumbled 5.2 percent to $193.80 after Wells Fargo analysts said the iPhone maker is the unnamed customer that optical communications company Lumentum Holdings said was significantly reducing orders. Shares in Lumentum plunged 30 percent to $38.92.
FINANCIALS SLIDE: Banks and other financial companies also took heavy losses. Goldman Sachs slid 5.9 percent to $209.53.
“Expectations are really that the deregulation process that has benefited banks up to this point is going to be slowed down with the Democrats in charge,” Bell said.
ON SHAKY GROUND: AECOM sank 8.2 percent to $30.05 after the engineering and construction company reported quarterly results and an outlook that disappointed Wall Street analysts.
LIFELINE EXTENDED: Athenahealth jumped 9.9 percent to $132.22 after the struggling medical billing software maker received a $5.7 billion cash buyout offer.
MAJOR MAKEOVER: Shares in cosmetic maker Coty rose 1.9 percent to $8.65 after the company said CEO Camillo Pane, who led the company for two years, has resigned for family reasons. Pierre Laubies, who last ran JDE, a beverage company, takes over immediately and will also have a seat on the board.
ENERGY: Benchmark U.S. crude bounced back from 10 days of losses, climbing 1 percent to $60.79 per barrel in New York. Brent crude, used to price international oils, picked up 1.1 percent to $70.93 per barrel in London. Oil futures rose on news that major producers planned to reduce output. Saudi Arabian energy minister Khalid al-Falih said Sunday that the kingdom will reduce exports by around 500,000 barrels a day from November to December. Russian oil minister Alexander Novak said at a meeting of oil producers in Abu Dhabi that his country was open to cuts.
CURRENCIES: The dollar slipped to 113.71 yen from 113.80 yen on Friday. The euro fell to $1.1248 from $1.1336. The British pound weakened to $1.2857 from $1.2975 amid concerns that Britain’s government is struggling to find unity on a Brexit deal.
MARKETS OVERSEAS: Major stock indexes in Europe declined. Germany’s DAX lost 1.8 percent and France’s CAC 40 fell 0.9 percent. Britain’s FTSE 100 shed 0.6 percent. In Asia, markets finished mixed. Japan’s Nikkei 225 added 0.1 percent, while Hong Kong’s Hang Seng rose 0.1 percent. Australia’s S&P-ASX 200 gained 0.3 percent. The Kospi in South Korea dipped 0.3 percent.