The Dow, the Nasdaq, and the S&P 500 end lower
General Electric shares close higher
Twitter shares take a nosedive
LATE TRADING SESSION:
US stocks changed direction in the closing hours of Tuesday’s trading and reported sharp losses, sunk by a sell-off in the tech sector and the resurfacing of the twin fears about a US-China trade war and rising interest rates.
The first index to fall into the red was the tech-heavy Nasdaq, which finished down 212 points at 7,008. The Dow Jones took as bad a hammering, shedding 345 points to close at 23,858 while the S&P 500 lost 46 points at 2613. In Canada, the TSX slumped by 82.4 points at 15,216.
By the day’s end, the meltdown in the markets had made its way into the government bond markets, with the yield on US Treasury bonds dropping to 2.78%.
The battering persisted at Twitter (NYSE:TWTR), with the stock closing down by 12.05% after it emerged that Citron Research, the short-selling research house run by Andrew Left, is shorting the stock due to concerns about possible regulatory problems.
On the Nasdaq, meanwhile, Longfin Corporation(Nasdaq:LFIN) also reported a 41.5% drop on the back of negative comments from analysts with Citron who said that its SEC filings and press releases were “riddled with inaccuracies and fraud”.
Other losers included NVIDIA (Nasdaq:NVDA), which saw its shares fall 7.8% in the wake of reports that it had suspended its self-driving technology following the fatal crash involving a Tesla car in Arizona this month.
Adobe Systems(Nasdaq:ADBE) also fell 6.65 to US$213.80 as technology stocks continued to be weighed down by a report that the Trump administration is weighing an investigation into Chinese companies looking to invest in US technologies. Facebook (Nasdaq:FB) shares also closed down 4.9 per cent at US$152.22 as concerns persisted about the surrender of its member information to Cambridge Analytica.
General Electric, meanwhile, was one of the few rosy offerings, with its beaten-down stock finishing up 4.3% at US$13.44 as rumors swirled that Warren Buffett is considering taking a stake in the company.
MID-SESSION:
The tech-heavy Nasdaq drifted into the red in midday trading and fell 26 points to 7,194, but elsewhere US stocks held their course.
The Dow Jones stayed in positive territory at 24,372 and more modest gains were had by the S&P 500, which inched up close to 6 points to 2,664. In Canada, the TSX inched up 40 points to 15,338.
Among the bright spots on the markets were shares of General Electric (NYSE:GE), which were up 5.6% at US$13.60. The beleaguered industrial conglomerate led the pack on the S&P 500 as rumors circled that Warren Buffett might want to buy a stake in it.
Arrowhead Pharmaceuticals(Nasdaq:ARWR), a Nasdaq-listed pharmaceuticals group, also jumped higher, rising 10.2% at US$7.65 after delivering advances in its development of a Hepatitis B drug.
On the NYSE, Twitter(NYSE:TWTR) was dragged down by as much as 9% at one point after short seller Andrew Left’s company Citron Research said it was shorting the company’s stock.
It was not the only tech stock to take a beating. The outcry over Cambridge Analytica’s digging into the user data of members still dragged down the social media giant Facebook’s (Nasdaq:FB) share price by 3% to US$155.06.
GGP Inc (NYSE:GGP), the mall operator, meanwhile, lost 3.78% to trade at US$20.43 after it accepted its largest shareholder Brookfield Property Partners’ revised bid for the remainder of its operations.
Also on the list of Nasdaq-listed losers was Geron (Nasdaq:GERN), a small-cap cancer company, which came crashing down by 9% at US$5.45 after an analyst questioned its impressive share price rise in recent weeks.
EARLY TRADE:
After the highs of Monday, US stocks started on the front foot Tuesday as the Dow Jones gained around 49 points at 24,252.
The S&P 500 added around three to 2,661.
The tech heavy Nasdaq added around 14 points to stand at 7,234.
US crude (West Texas Intermediate) also went higher - up 0.50% to US$65.87 a barrel.
“Yesterday’s 664 point rally in the Dow amounted to the third biggest single day point gain in history, with investors beginning to see light at the end of the tunnel after a period which threatened to see a global trade war break out," said Joshua Mahony, market analyst at IG.
"With Trump tweeting of multiple trade discussions going on behind the scenes, there is a feeling that the ultimate resolution will likely be a greater global access for US firms, highlighting why we are seeing an outperformance in US stocks."
In stocks on Wall Street, computer giant Microsoft (NASDAQ:MSFT) rose another 1.4% in early deals after yesterday’s bullish broker call.
US-listed shares of British drugmaker GlaxoSmithKline (NYSE:GSK) rose 3.5 % after the company agreed to buy out its Swiss partner Novartis in their consumer health joint venture.
Red Hat Inc (NYSE:RHT) was up 4.59% to US$160.50 as the open-source software developer beat Wall Street estimates with is fourth-quarter earnings.
The North Carolina-based group reported sales of US$772mln in the quarter ended February 28.
That is a 23% increase compared to the year-ago period and leaves Red Hat on track to generate revenues of more than US$3bn in 2018 if it can maintain that performance.