Shares of technology companies tumbled as Treasury yields shot up, registering a shock from August inflation data.
The Nasdaq Composite plummeted by more than 5% for one of its largest retreats in recent years. Tech issues are particularly sensitive to movements in Treasury yields because of how investors evaluate future growth potential in the context of current low-risk returns. A moderation in inflation expectations in recent weeks had stirred demand for high-risk tech stocks, but that risk appetite was immediately eviscerated by the inflation data.
Apple shares fell sharply, closing more than 11% below its peaks a month ago. Apple had rallied earlier this week because of an impression that a new generation of iPhones would sell well, said Quincy Krosby, chief global strategist at brokerage LPL Financial.
"Now I just looked, and Apple is down over 6% ... what changed? The only thing that changed is this [inflation] report."
Oracle shares fell modestly after the business software maker posted fiscal first-quarter earnings ahead of Wall Street targets.
Write to Rob Curran at rob.curran@dowjones.com
(END) Dow Jones Newswires
09-13-22 1712ET
