Tech sell-off leads Wall Street reverse

US stock markets dropped their bundle overnight after the Bank of England warned of double-digit inflation and rising recession risk in the UK.

James Dunn
May 6, 2022

After a positive session the previous day, US stock markets dropped their bundle after the Bank of England warned of double-digit inflation and rising recession risk in the UK.

That, and some disappointing quarterly earnings reports, triggered a tech sell-off, with Facebook’s parent Meta Platforms (NASDAQ: FB) falling 6.8%, Amazon (NASDAQ: AMZN) losing 7.6%, Microsoft (NASDAQ: MSFT) surrendering 4.4%, Salesforce (NYSE: CRM) slumping 7.1%, and Apple (NASDAQ: AAPL) losing 5.6%. Afterpay’s new owner, Block (NYSE: SQ), lost 10.5%.

The tech-heavy Nasdaq Composite Index ended the day with a 5% loss, to finish at 12,317.69, its lowest closing level since November 2020. It was the Nasdaq’s worst single-day drop since 2020, and the 30-stock Dow Jones Industrial Average recorded the same stat, losing 1,063 points, or 3.1%, to close at 32,997.97. The broader S&P 500 Index lost 3.56%, marking its second worst day of the year.

On the bond market, a sell-off in long-end Treasuries pushed yields to fresh multi-year highs overnight, with the benchmark 10-year rate pushing well beyond the 3% threshold that has been tested for four straight trading sessions. The yield on the US 30-year bond rose 17 basis points to peak above 3.2%, its highest level since December 2018.

The Australian dollar is buying 71 US cents this morning.

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James Dunn

James Dunn has been a finance and business journalist since 1988, operating across the entire spectrum of these areas, from personal investment to high-end institutional finance. Within that spectrum James has developed a wide range of knowledge of the financial markets, investment asset classes, the global economic environment and most importantly, how these all coalesce.

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