Wall Street: Nasdaq 100, S&P 500 and Dow 30 fall more than 2% with top stocks ending 5% lower

Inflationary data leading to rising yields, increasing concern of Covid-19 in China, ongoing war in Ukraine and the fear of it spreading any further are keeping investor confidence on shaky ground.

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Meanwhile investors may find solace in tech-sector ETFs with a long term view as some more volatility is expected in 2022.

US Stocks: It was a red letter day on Wall Street on Tuesday. US stocks fell like ninepins and the damage was all across the board. S&P 500 ( 120 points lower) , Nasdaq 100 ( 523 points lower) and Dow 30 ( 809 points lower) shed nearly 2.81 per cent, 3.87 per cent and 2.38 per cent respectively. Russell 2000, a barometer of the performance of the small-cap segment of the US stock market universe, fell by about 3.26 per cent.

Post the March hike in interest rate, the Fed is gearing up to tame inflation and the primary ammunition to do it is to hike rates further. Corporate profits are going to be hit thus impacting stock values, some of which are trading at high valuations.

Also, inflationary data leading to rising yields, increasing concern of Covid-19 in China, ongoing war in Ukraine and the fear of it spreading any further are keeping investor confidence on shaky ground.

The conviction in tech stock’s performance also seems to be fading away, at least for the time being. Some of the technology stocks have already shed nearly 20 per cent from their highs.

Tesla, Lucid Group, ASML Holding, DocuSign, CrowdStrike Holdings, Advanced Micro Devices, Intuit and NVIDIA were among the big US stocks that fell between 5 and 12 per cent on April 26.

Earnings results from Alphabet Inc., Microsoft Corp. and Texas Instruments appear to be disappointing and the market sentiments may continue to slide downwards.

While Netflix’s poor show is now on the back burner, the impact of the series of Fed rate hikes remains to be seen. It seems, there could be more pain left before the sun shines again on the tech sector stocks.

The measures Fed takes will be closely watched by the investors globally. Meanwhile investors may find solace in tech-sector ETFs with a long term view as some more volatility is expected in 2022.

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