By Yasin Ebrahim

Investing.com – The S&P 500 closed lower Thursday, as selling in tech stocks resumed following a rebound earlier this week. 

They fell 1.4% and 0.5% respectively, 174 points. The Nasdaq suffered a 2.5% drop.

Meta, formerly Facebook (NASDAQ:), Google-parent Alphabet (NASDAQ:), Amazon (NASDAQ:),  Apple (NASDAQ:), and Microsoft (NASDAQ:) were in the red, with the latter down more than 4%.

Still, some on Wall Street see growth ahead for Microsoft as strong cloud spending by businesses will likely benefit the company’s cloud business Azure.

“Our December quarter checks for Microsoft have shown incremental strength again as the Azure cloud growth story is hitting its next gear of growth in Redmond,” Wedbush said.

The stock is set to climb over the next six to nine months “despite multiple/valuation compression and a tightening Fed backdrop […] as the Street is still underestimating the underlying growth story in Redmond (Microsoft),” it added.

Snap (NYSE:), meanwhile, slumped 10% after Cowen downgraded the stock to market perform, citing ongoing challenges from Apple’s change in privacy rules.

The slowdown in rising Treasury yields rates following data showing inflation pressures for businesses slowed in December didn’t offer any respite for tech.

In December, the index rose 0.2%. This is a much lower than the 0.4% expected rise and slower that the November 1.0% increase.

In the labour market, however, weekly unemployment claims rose unexpectedly by 23,000. Economists attribute this to the Omicron variation.

The Omicron disruptions, however, are expected to be “short-lived, but they will create some volatility in the next couple of weeks,” Jefferies said in a note.

The broader market was affected by the health care sector, which saw a more-than 5% decline in prices. Moderna (NASDAQ:). Even though the company stated it would report March data on its Covid-19 vaccine trials for children aged 2-5 years olds,

Elsewhere on the pandemic front, the Supreme Court blocked President Joe Biden’s vaccine-or-test rule, which would require that businesses with at least 100 employees mandate vaccinations or test weekly for Covid.

Industrials closed the day higher and outperformed the broad market. The rally in airline stocks was a result of better-than expected quarterly results from Delta Air Lines. As travel demand continues to increase, it also supported the industrials.

American Airlines (NASDAQ;) saw a 4% increase, United Airlines was up 3% and Delta Air Lines, (NYSE:), more than 1%.

Investors were looking for safety, and consumer staples as well as utilities became the most popular concerns.