Rally fizzles out as tech tumult sinks US stocks again
The S&P 500’s 1.2% rally fizzled in the afternoon, ending the day with a 0.5% loss — the first close below 5,400 for the benchmark US stock gauge since June 11. The three-day decline of 3% is the worst stretch for the S&P since October.
The tech-heavy Nasdaq 100 also saw its advance turn into a 1.1% fall, while small caps held on to most of their gains as the Russell 2000 ended up 1.3%.
Tech and tech-adjacent firms were the problem children once again, with losses in excess of 1% for the sector as well as communication services leaving them the worst-performing S&P sector ETFs.
Five of the “Magnificent Seven” ended the day down more than 1%, with Alphabet’s 3.1% decline the lowlight. Tesla bucked the trend with a gain of 2% while Apple finished down just 0.5%.
However, there were positive earnings stories in the space: namely ServiceNow, which topped the S&P 500 leaderboard with a 13.4% gain after strong sales results that management said were tied to the generative AI boom.
Energy was a big standout among S&P sector ETFs, up 1.7% as oil prices rebounded to erase some of their July retreat.
Ford, on the other hand, had an 18.4% plunge in its worst day since 2008. The automaker whiffed on earnings due in part to an unexpected rise in warranty costs as quality problems continue to plague some of its offerings.
