S&P 500 Slides as Tech Bloodbath Continues By Investing.com
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By Yasin Ebrahim
Investing.com – The S&P 500 slumped Monday, paced by a selloff in tech at a time when investors are fretting about rising inflation and slowing growth.
It fell 1.3%.
Facebook (NASDAQ): fell 5% after Frances Haugen, a whistleblower for Facebook, claimed that Facebook prioritizes profits over user wellbeing.
Twitter (NYSE 🙂 and Snap(NYSE 🙂 fell more than 6 percent after the news.
Tech’s selloff was further exacerbated when investors priced in inflation and higher rates of return.
Apple (NASDAQ) and Microsoft (NASDAQ), as well Amazon.com (NASDAQ), Alphabet (NASDAQ), were all down more than 3 percent.
High-value growth stocks such as tech tend to have cash flow that is more outwardly oriented than the present, which can be unattractive when inflationary conditions are in place.
Health care also contributed to the sea of red on Wall Street, led by Moderna (MX:) as investors continued to ditch the stock following positive news of Merck’s late-stage trial for their new anti-viral pill.
Energy stocks buck the trend. This was due to rising oil prices, which were supported by OPEC+’s decision to keep to an agreement that would increase oil output by 400,000 barrels/day in November.
Wall Street’s mood was also affected by the uncertainty that Washington continues to create on multiple fronts. For example, Washington must raise its debt ceiling before Oct. 18 to stop the U.S. going into default on its debt.
Auto stocks rose with General Motors and Tesla leading the charge.
General Motors (NYSE 🙂 rose 1% in the wake of Engine No. 1. An activist hedge fund stated it purchased a stake in General Motors (NYSE:) citing its optimism about the company’s plans for electric vehicle expansion.
Tesla (NASDAQ:) rose 1% in the meantime after it reported that the number of vehicles sold in Q3 exceeded record levels despite continuing shortages in chips.
Oppenheimer wrote in a note that “We take note of the company’s flexible operating system and supply change management seem to be working well, as demand continues outstrip supply.”
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