Tech shares fall again as Trump, Fed worries weigh

NEW YORK (AFP) – Technology shares suffered another bout of weakness on Thursday (June 15), leading the broader market lower amid unease over rising US interest rates and uncertainty about President Donald Trump’s agenda.

Analysts said lackluster data on US homebuilder sentiment and industrial production dented confidence in light of the Federal Reserve’s decision Wednesday to raise the benchmark lending rate for the third time in six months, and signal an additional hike later this year.

Trump’s travails also weighed on the market following reports the US president is being investigated personally for obstruction of justice.

The Dow Jones Industrial Average slipped 0.1 per cent to close the day 21,359.90.

The broad-based S&P 500 dipped 0.2 per cent to end at 2,432.46, while the tech-rich Nasdaq Composite Index fell 0.5 per cent to 6,165.50.

Technology shares with declines included Apple, down 0.6 per cent, Amazon, down 1.3 per cent, Priceline, down 1.2 per cent, and Tesla Motors, down 1.5 per cent.

But industrial stocks moved in the opposite direction, with General Electric gaining 0.8 per cent, and Boeing and Caterpillar each up 1.6 per cent.

Retail and retail-dependent brands had another rough day.

Supermarket chain Kroger plummeted 19.1 per cent after cutting its profit forecast due to ramped-up investment in e-commerce, higher wages and competitive pricing.

The meager outlook also hit Wal-Mart Stores, which lost 1.3 per cent, Target, down 4.1 per cent, and Dollar Tree, down 3.4 per cent.

Dow member Nike dropped 3.2 per cent after announcing it would cut two percent of its global staff as part of a reorganisation plan to beef up direct selling to consumers as e-commerce roils the retail sector.

Mattel slumped 6.7 per cent, falling for a second straight session after the company unveiled a turnaround strategy that included a big cut to the dividend to finance technology investment initiatives.