Tech stocks lead market rout; Nasdaq plunges 3.1%

Traders work on the floor of the New York Stock Exchange after the ringing the Opening Bell on April 1, 2014 in New York City. The tech-rich Nasdaq Composite Index Thursday led US stocks sharply lower as anxiety about pricey technology equities
Traders work on the floor of the New York Stock Exchange after the ringing the Opening Bell on April 1, 2014 in New York City. The tech-rich Nasdaq Composite Index Thursday led US stocks sharply lower as anxiety about pricey technology equities returned with a vengeance and dragged down the broader market. -- PHOTO: AFP

NEW YORK (AFP) - The tech-rich Nasdaq Composite Index Thursday led US stocks sharply lower as anxiety about pricey technology equities returned with a vengeance and dragged down the broader market.

The Nasdaq tumbled 129.79 points (3.10 per cent) to 4,054.11.

The Dow Jones Industrial Average sank 266.96 (1.62 per cent) to 16,170.22, while the broad-based S&P 500 fell 39.10 (2.09 per cent) to 1,833.08.

The sell-off came on a day when Chinese trade data disappointed and suggested more weakness in the world's second-biggest economy.

But the losses deepened throughout the day, suggesting continued fear over the valuations of high-flying tech companies like Netflix, Facebook and Tesla Motors.These companies were among the biggest losers.

Most analysts do not consider conditions comparable to those of the early-2000s tech bubble, but the memory of Nasdaq's plunge in that period is not that distant.

"It's certainly a valuation correction," said Jack Ablin, chief investment officer at BMO Private Bank.

"We've got lots of liquidity, but we have a stretched market," Ablin said. "Probably the best solution would be to have earnings and revenues rise."