Tech Sector Leads Wall Street Lower
(AP) -- Stocks fell broadly in morning trading on Wall Street Monday and bond yields continued rising as investors anticipate moves by the Federal Reserve to raise interest rates.
The S&P 500 fell 1.8% as of 10:26 a.m. Eastern. The Dow Jones Industrial Average fell 523 points, or 1.5%, to 35,716 and the Nasdaq fell 2.3%.
Technology stocks again led broader market lower. The sector has been the biggest weight on the market through January. Big technology stocks have an outsized influence on the S&P 500 because of their huge size. Microsoft fell 2.5% and Apple shed 2.1%.
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Wall Street is closely watching the Federal Reserve for clues as to how soon it might raise interest rates. The central bank has already said it will accelerate the reduction of its bond purchases, which have helped keep interest rates low.
Higher interest rates make the stocks of expensive tech companies and other pricey growth companies less attractive to investors, which is why the sector has been slipping while bond yields rise.
The yield on the 10-year Treasury rose to 1.80% from 1.76% late Friday.
Every sector in the benchmark S&P 500 fell, though sectors that are considered less risky, including utilities and household goods makers, held up better than the rest of the market.
Elsewhere in the market a mix of deal news and financial updates moved several large stocks.
Take-Two Interactive, maker of "Grand Theft Auto", plunged 14.4% after announcing a deal to buy Zynga, which makes "Words With Friends" and "Farmville" and jumped 44.7%.
Athletic apparel maker Lululemon Athletica fell 5.6% after warning investors that a surge in virus cases hurt its fourth-quarter financial results. Medical products maker and distributor Cardinal Health fell 9.5% after saying that supply chain problems will hurt profits for its medical segment.
Investors have a busy week of economic reports and corporate earnings.
On Wednesday, the Labor Department will give Wall Street an update on how inflation is impacting prices with its Consumer Price Index for December. The agency will release give investors details on how inflation is impacting businesses with its Producer Price Index for December on Thursday.
On Friday, Citigroup, JPMorgan Chase and Wells Fargo will report their latest quarterly financial results.