US Stocks Mixed As Tech Sector Loses Steam

Wall Street stocks diverged Thursday as tech firms slipped while traders digested earnings reports and flare-ups in the Middle East war.

Although the Dow Jones Industrial Average added 1.1 percent to 51,220.18, the S&P 500 ticked down 0.2 percent to 51,220.18.

The Nasdaq Composite Index dropped 0.9 percent to 26,631.02.

Tech shares traded lower after semiconductor maker Broadcom’s earnings report and guidance “failed to live up to the sky-high expectations embedded in the stock price,” said Patrick O’Hare of Briefing.com.

“The disparate moves reflect a rotation away from the leading tech stocks and into the lower-beta, more traditional blue-chip shares,” he added in a note.

Broadcom shares tumbled 14.4 percent shortly after markets opened.

Among other semiconductor firms, Arm Holdings was down 6.1 percent while Micron retreated 6.3 percent.

Still, Art Hogan of B. Riley Wealth Management told AFP that “it’s normal market activity for things to take a pause and it’s probably healthy.”

He added that markets are also operating with an understanding that there will be an end to the war with Iran, although cautiously monitoring progress towards this outcome.

The war began with US-Israeli strikes on Iran from February 28, and has engulfed the Middle East.

Tehran retaliated by effectively blocking the Strait of Hormuz, a key waterway for energy and fertilizer transit, sending oil prices soaring.

“The longer that lasts, the more that’s going to impact inflation and economic growth,” Hogan said.

Iran said Thursday that the United States and Israel were dealt a “decisive blow” in the conflict, with its government noting “no tangible progress” in talks to end the war.

Separately, rocket and satellite firm SpaceX — led by US billionaire Elon Musk — said Wednesday that it aimed to raise some $75 billion in a record initial public offering.

“We will have to wait and see how much of that new issuance the market can absorb,” Hogan said.