By Yasin Ebrahim

Investing.com – The S&P 500 fell Tuesday, as tech stocks slumped following a surge in Treasury yields and signs of consumer weakness at a time when concerns about a more sustained pace of inflation continue to heat up.

The fell 1.8%, the slipped 1.6%, or 507 points, the Nasdaq slumped 2.6%.

The topped 1.5%, rising to its highest level since June, as investors fret about the prospect of the Federal Reserve raising interest rates sooner than expected to control inflation.

Desjardins wrote in a note that “the many supply-demand imbalances, along with new production restrictions stemming form the pandemic, may cause inflation to surge more than expected.”

As tech was seen as a growth sector of the market with higher earnings in the long-term, it was discouraged. This is because money today will be more valuable than the money tomorrow.

Apple (NASDAQ), Facebook, Google-parent Alphabet and Amazon.com were all 2% below.

As a result, chip stocks pushed the broader technology sector deeper into red. The biggest losers were ASML (NASDAQ;), Applied Materials(NASDAQ:) as well as Teradyne.

The only sector that was green were energy, even though oil prices continued to gain despite investors continuing to believe rising energy demand and supply-chain problems will continue.

Consumer confidence was lower than expected due to the negative impact of the Delta variant on sentiment.

The Conference Board’s index fell unexpectedly to a reading of 109.3 from 115.2, missing economists estimates for 115.0.

Jefferies (NYSE 🙂 stated in a note that “just like what we’ve seen in sentiment data from the University of Michigan over the last two months, consumers feel the pain of disappointment due to the Delta variant of COVID.”

In other news, Ford Motor (NYSE:) unveiled plans to invest in a new assembly plant and three battery factories, in an effort to speed up its push into electric vehicles