U.S. stocks fell Tuesday global slowdown worries mounted, continuing the April sell-off.
The Dow Jones Industrial Average shed about 420 points, or 1.2%. The S&P 500 lost 1.7%. The tech-heavy Nasdaq Composite retreated 2.8%.
The tech-heavy Nasdaq fell back into bear market territory, sitting about 22% from its intraday high. For April, the S&P 500 is off by more than 6%, the Nasdaq is down about 11% and the Dow is down roughly 3%.
Concerns about the global economy loomed as investors worried about a Covid surge in China and potential lockdowns in Beijing.
“There are a lot of economic growth concerns,” said Peter Boockvar, chief investment officer at Bleakley Advisory Group. “China is a big customer for U.S. tech. … The semiconductor industry does a lot of business there. But it’s also concerns with growth here as well.”
Mega-cap tech names fell ahead of quarterly earnings reports this week. Microsoft and Google parent Alphabet both shed more than 2% ahead of quarterly reports after the bell Tuesday. Facebook parent Meta, Amazon and Apple were also lower Tuesday, with earnings results slated for later this week.
The strength in Big Tech stocks in recent years “is likely to burst when fundamentals start to meaningful deteriorate as the overall economy slows,” Wolfe Research’s Chris Senyek said in a research note.
Tesla, which has a factory in Shanghai and counts China as a major market for its electric vehicles, was the biggest laggard on the Nasdaq Composite, down 9%.
Chip stocks were among the top decliners on the Nasdaq Composite. Nvidia fell about 5% and AMD retreated more than 4%.
Cyclical names tied to economic growth also suffered Tuesday. Dow component 3M fell about 2% despite better-than-expected earnings as the company noted macroeconomic and geopolitical challenges ahead. UPS shares also fell 3% despite the shipper’s quarterly earnings and revenue topping expectations.
Other industrial names like General Electric and Boeing were lower in early morning trading Tuesday. GE fell more than 10%, while Boeing eased 2.8%.
Bank stocks also struggled as interest rates fell. U.S. Treasury yields declined, with the benchmark 10-year rate falling below 2.8%. Goldman Sachs fell more than 1% and Wells Fargo was marginally lower.
Tuesday’s sell-off was broad-based with every sector down except energy, which benefited from slightly higher oil prices.