Off The Wire
Nasdaq leads losses as tech weakness dents Wall Street
Nov 23 (Reuters) - The Nasdaq lagged its Wall Street peers on Tuesday as rising Treasury yields weighed on major technology stocks, while gains in banks and energy helped limit losses in the S&P 500 and the Dow Jones.
The S&P tech subindex (.SPLRCT) sank 1.2% as rising yields dented appeal of the high-growth sector. Tesla Inc (TSLA.O) and Microsoft Corp (MSFT.O) were the worst performers among trillion-dollar tech firms, falling 3.2% and 1.4%, respectively.
Treasury yields extended gains from Monday as investors ramped up expectations for interest rate hikes next year after Jerome Powell was nominated by President Joe Biden as Fed Chair for a second term.
The S&P 500 energy index (.SPNY) jumped 2.8% and was the best-performing sector, tracking higher oil prices after a move by the United States and other consumer nations to try to cool the market fell short of some expectations.
"What you may be seeing with growth stocks is investors are rotating into different sectors, they are not rotating out. They are still bullish," said Eric Schiffer, chief executive of private equity firm Patriarch Organization in Los Angeles.
An IHS Markit survey showed U.S. business activity slowed moderately in November amid labor shortages and raw material delays, but remained comfortably in expansion territory on strength in the manufacturing sector. read more
At 12:03 p.m. ET, the Dow Jones Industrial Average (.DJI) was down 4.76 points, or 0.01%, at 35,614.49 and the S&P 500 (.SPX) was down 19.22 points, or 0.41%, at 4,663.72. The Nasdaq Composite (.IXIC) was down 196.46 points, or 1.24%, at 15,658.30.
The Nasdaq and the S&P 500 had slipped from record highs on Monday, as Powell's nomination prompted a volatile session.
The CBOE volatility index (.VIX) briefly rose to a more than one-month high earlier on Tuesday.
With the Thanksgiving holiday expected to keep volumes low this week, markets could see high volatility.
"Because it's illiquid you'll probably see greater volatility in individual stock names and the potential for greater movement in the market based on any news that hits it," said Rick Meckler, partner at Cherry Lane Investments In New Vernon, New Jersey.
Among other stocks, Zoom Video Communications Inc (ZM.O) fell 18.6% after its third-quarter revenue growth rate slowed to 35% as demand for its video-conferencing tools eased from pandemic-fueled heights last year. read more
Declining issues outnumbered advancers for a 1.60-to-1 ratio on the NYSE and for a 2.02-to-1 ratio on the Nasdaq.
The S&P index recorded eight new 52-week highs and six new lows, while the Nasdaq recorded 38 new highs and 424 new lows.