Tech shares tumble amid revived fears of inflation

New data showed lacklustre services sector activity and private-sector job growth that lagged expectations.
New data showed lacklustre services sector activity and private-sector job growth that lagged expectations.PHOTO: REUTERS

NEW YORK (AFP) - Tech shares had another ugly session on Wall Street on Wednesday (March 3) following disappointing US economic data and amid ongoing worries over rising Treasury yields.

New data showed lacklustre services sector activity and private-sector job growth that lagged expectations in February.

Investors are also keeping an eye on US Treasury yields, which resumed an upward climb, a warning sign of inflation concerns that revived fears the Federal Reserve will move to raise interest rates.

Higher yields "put people a little on edge," said Briefing.com analyst Patrick O'Hare.

The Dow Jones Industrial Average dropped 0.4 per cent to close the session at 31,270.09.

The broad-based S&P 500 fell 1.3 per cent to 3,819.72, while the tech-rich Nasdaq Composite Index tumbled 2.7 per cent to 12,997.75.

Worries about inflation offset the improving outlook for vaccinations after US regulators approved Johnson & Johnson's vaccine and President Joe Biden said there would be sufficient supply for all American adults by the end of May.

A Fed report said activity in the American economy expanded only "modestly" and job gains were slow in recent weeks, but firms are becoming more upbeat about their prospects as Covid-19 vaccines are rolled out nationwide.

Among individual stocks, Las Vegas Sands rose 1.3 per cent after reaching an agreement to sell the Venetian Resort and other Las Vegas assets for US$6.3 billion (S$8.4 billion) to a group of investors managed by Apollo Global Management.

Lyft surged 8.3 per cent after the ride-hailing company described improving demand in February, including its best week for volume since March 2020.