U.S. Indexes Under Pressure Again As Tech Selloff Goes Global

Barry Adams
12 May, 2022
New York City

U.S. stocks extended losses and the benchmark index S&P 500 inched closer to bear market territory. 

The S&P 500 index declined 1.2% to 3,886.34 and the Nasdaq Composite index fell 1.7% to 11,183.07. 

For the year so far, the S&P 500 index has fallen 18.9% and the Nasdaq Composite index has dropped 29.4%. 

Global markets are also on the downside as indexes in Europe ease more than 2% and in Asia declined between 1.8% and 2.2%. 

Tech stocks around the world are falling following losses in the tech heavy weights in the U.S. 

In today, trading Apple dropped 3.6% to $141.29, Google parent Alphabet declined 0.9% to 2,258.60, Microsoft fell 1.7% to $256.04. 

Amazon traded near flat-line at 2,099.34 and has now lost all the gains during the Pandemic boom since March 2020. 

The latest data on the wholesale price index failed to calm market jitters. 

The producer price index rose 0.5% in April from March or 11% from a year ago, the Bureau of Labor Statistics reported today. 

The index had gained at annual rate of 11.5% in March.  

Core rate of wholesale inflation excluding food, energy and services rose 0.6% in April and jumped 6.9% from a year ago but slower than 7.1% annual rate in March. 

A separate economic report from the agency noted jobless claims increased 1,000 to 203,000 in the week ending on May 7. 

However, the continuing claims declined 44,000 to 1.343 million, the lowest level since Jan 3, 1970. 

In Europe, indexes fell more than 2% on the rising inflation worries. 

The DAX index fell 2.3% to 13,503.21, the CAC-40 declined 2.5% to 6,111.47, and the FTSE 100 index decreased 2.1% to 7,191.35. 

Siemens declined 7% after the company said it will leave Russia. 

U.K. GDP growth declined to 0.8% after expanding at 1.3% in the previous quarter on a sequential basis, the Office of National Statistics said. 

The economic activities shrank 0.1% in March but overall the economy is larger by 1.2% from its pre-COVID February 2020 level. 

In Asian trading indexes generally closed lower after the release of the U.S. inflation data. 

The Nikkei index declined 1.8% to 25,748.22 and the Hang Seng Index dropped 2.2% to 19,380.34. 

Tech stocks led the losers in Tokyo and Hong Kong following the losses in the U.S.

SoftBank Group declined 4% and KDDI, Tokyo Electron, and Advantest fell between 2% and 4%.   

Stocks in Mumbai traded sharply lower following weak markets in Asia and the resurgent inflation. 

The Sensex index closed down 2.1% to 52,930.21 and the Nifty index fell 2.2% or 359.10 to 15,808.00. 

India's consumer inflation index is at a 8-year high but below 8.33% in May 2014 and the Industrial Production Index increased 1.9% in March, the report also noted. 

The Kospi index in Seoul dropped 1.6% and extended losses for the eighth day in a row. The index is now trading near an 18-month low on the weakness in tech stocks. 

Samsung Electronics, SK Hynix and Hyundai declined more than 1%. 

The Australian market index dropped to a five-month low on the weakness in tech and bank stocks. 

The ASX 200 fell 1.8% to close at 6,941.