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Market Snapshot: Dow drops more than 300 points as tech selloff deepens

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Stocks slumped in early trade Tuesday as inflation fears sent large-cap tech-related shares skidding sharply lower.

What are major benchmarks doing?
  • The Dow Jones Industrial Average
    DJIA,
    -1.42%

    fell 347.16 points, or 1%, to 34,395.66.
  • The S&P 500
    SPX,
    -1.34%

    gave up 50.91 points, or 1.2%, to trade at 4,137.52.
  • The Nasdaq Composite
    COMP,
    -1.32%

    tumbled 206.59 points, or 1.5%, to 13,195.27.

On Monday, a tech-led selloff sent the Nasdaq down 2.6% to its lowest close since March 31, while the S&P 500 slumped 1%. The Dow gave up a gain of more than 300 points that had taken it to an all-time high above 35,000 to end the day down 34.94 points, or 0.1%.

What’s driving the market?

Big tech shares continued to feel the pain Tuesday, with shares of Facebook Inc
FB,
-1.28%
,
Microsoft Corp. MSFT and Amazon.com Inc.
AMZN,
-0.87%

down more than 1%, and Google parent Alphabet Inc.
GOOG,
-1.49%

GOOGL,
-1.18%

and Apple Inc.
AAPL,
-2.54%

both down more than 2%.

“There isn’t a clear catalyst behind this purge,” said Marios Hadjikyriacos, investment analyst at XM, in a note. “It seems to be a combination of inflation fears making a comeback and some market participants moving higher along the value spectrum, cutting their exposure to anything with a stretched valuation.”

The fact that the selloff has been mostly concentrated in tech and growth stocks, however, is encouraging in terms of the overall market outlook, Hadjikyriacos said, because it indicates investors haven’t lost faith in the economic outlook but are moving away from “more speculative” positions, which could even calm some “bubble concerns, considering what is being sold.”

Investors are also concerned about the labor market after a much smaller-than-expected rise in nonfarm payrolls in March was reported on Friday.

The National Federation of Independent Business said Tuesday its monthly survey found a record 44% of small businesses said job openings went unfilled in April.

Data on U.S. March job openings is due at 10 a.m. Eastern.

Investors will also hear from several Federal Reserve officials on Tuesday, including New York Fed President John Williams, Fed Gov. Lael Brainard, San Francisco President Mary Daly, Atlanta Fed Raphael Bostic, Philadelphia Fed President Patrick Harker, and Minneapolis Fed President Neel Kashkari.

Which companies are in focus?
What are other markets doing?
  • The yield on the 10-year U.S. Treasury note
    TMUBMUSD10Y,
    1.619%

    rose 1.4 basis points to 1.615%. Yields and bond prices move in opposite directions.
  • The ICE U.S. Dollar Index
    DXY,
    -0.16%
    ,
    a measure of the currency against a basket of six major rivals, was down 0.1%.
  • Oil futures were under pressure, with the U.S. benchmark
    CL00,
    +0.35%

    down 1.8% at $63.78 a barrel on the New York Mercantile Exchange Gold futures
    GC00,
    -0.29%

    were lower, down 1% at $1,818.50 an ounce.
  • European equities fell sharply, with the Stoxx Europe 600
    SXXP,
    -2.00%

    down 2.4% and London’s FTSE 100
    UKX,
    -2.25%

    falling 2.8%.
  • Hong Kong’s Hang Seng Index
    HSI,
    -2.03%

    dropped 2%, while the Shanghai Composite
    SHCOMP,
    +0.40%

    rose 0.4% and Japan’s Nikkei 225
    NIK,
    -3.08%

    sank 3.1%.

: Energizer CEO says inflation will keep going and going, disputing what the Fed has said

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