Wall Street falls as sell-off continues

  • 09/02/2016
Wall Street falls as sell-off continues

By Abhiram Nandakumar

Wall Street fell sharply in early trading on Monday (local time), continuing a technology-led sell-off from Friday, as fears of a worsening global-economic slowdown and dropping oil prices continued to rattle investors.

The Nasdaq Composite that includes large-cap technology names such as Alphabet, Microsoft and Facebook was off 1.7 percent on Monday.

Microsoft's 3.3 percent decline weighed the most on the S&P 500 and the Nasdaq.

Heavyweights Facebook, Amazon, Netflix and Alphabet were down between two percent and foue percent.

"Equities are in a 'go-nowhere-fast' mode, with a downward bias in the near term," said Terry Sandven, chief equity strategist at US Bank Wealth Management in Minneapolis.

"We need oil to stabilise to provide some confidence for investors, partly because to a degree, investors' stress is high, earnings visibility is low, and market internals continue to weaken," he said.

US crude oil prices fell 2.6 percent after a meeting between Saudi Arabia and Venezuela failed to reassure investors of measures to bolster prices.

Demand for crude is considered a barometer for global economic health, and markets across the world have tracked the rise and fall in the price of the commodity this year.

On Monday morning the Dow Jones industrial average was down 238.19 points, or 1.47 percent, at 15,966.78.

The S&P 500 was down 30.73 points, or 1.63 percent, at 1,849.32.

The Nasdaq Composite index was down 93.95 points, or 2.15 percent, at 4,269.19. The index closed at its lowest since October 2014 on Friday.

Nine of the 10 major S&P sectors were lower, with the 1.95 percent fall in tech stocks leading the decliners.

Dismal sales outlooks from marquee technology names LinkedIn and Tableau Software had sent shares in the enterprise sector crashing on Friday amid fears IT managers were curbing spending.

Cognizant added to those worries on Monday. The IT services provider dropped six percent to $US55 after it forecast its slowest revenue growth in 14 years.

LinkedIn, which closed down 43.6 percent on Friday, was up one percent at $US109.50 on Monday.

Tableau, which almost halved in value on Friday, was down 4.8 percent at $US39.35.

Twitter shed 4.5 percent to hit a new record low of $US15.03 after reports over the weekend that the company was planning to change how it displays tweets.

Declining issues outnumbered advancing ones on the NYSE by 2,453 to 295. On the Nasdaq, 1,962 issues fell and 351 advanced.

The S&P 500 index showed four new 52-week highs and 45 new lows, while the Nasdaq recorded no new highs and 197 new lows.