U.S. Stocks Retreat as Tech Shares Plunge, Banks Add to Gains

  • Nasdaq 100 slumps 1.5 percent as large-cap tech tumbles
  • Car shares rise as Ford November sales top estimates

U.S. stocks fell from near all-time highs, after equities capped their first monthly advance in four, as technology shares plunged to overshadow rallies in bank and energy shares.

The S&P 500 Index fell 0.4 percent to 2,191.08 at 4 p.m. in New York. The benchmark index climbed 3.4 percent in November for its best gain in eight months amid speculation the incoming president will push through policies that boost growth in the world’s largest economy. The Dow Jones Industrial Average added 68.35 points to 19,191.93 Thursday, while the tech-heavy Nasdaq 100 Index slid 1.6 percent to a two-week low.

Technology shares have lagged behind during a post-election rally that’s boosted banks to the highest since February 2008 amid speculation Donald Trump’s cabinet picks signal a slackening of regulations for the financial sector. Oil shares added to gains sparked by OPEC’s intention to curb crude output. Trump’s trade policies may have the potential to harm large-cap technology providers.

The group slumped Thursday after a report that Apple Inc. has started reducing orders from iPhone 7 suppliers. Semiconductor shares plunged 4.6 percent. IBM Corp. and Microsoft Corp. lost at least 1.5 percent.

“You have the potential for higher interest rates resulting from bigger deficits, and that’s causing some of the rate-sensitive areas to once again come under pressure,” said Bill Schultz, who oversees $1.2 billion as chief investment officer of McQueen, Ball & Associates Inc. in Bethlehem, Pennsylvania. “On the flipside, you have another day of strength in the oil patch, and the beneficiaries from higher infrastructure spending are moving up.”

Attention will turn to tomorrow’s government payrolls data for clues on the strength of the economy and the timing for higher interest rates. A private report yesterday showed better-than-forecast figures. Traders are pricing in a 100 percent chance policy makers will increase rates this month, up from 68 percent at the start of November.

Among stocks moving Thursday:

  • Automakers rose, with General Motors Co. adding 5.5 percent and Ford Motor Co. gaining 3.9 percent after reporting sales that exceeded analyst estimates.
  • Energy shares increased for a second day as ConocoPhillips, Marathon Oil Corp. and Whiting Petroleum Corp. climbed more than 2.4 percent after OPEC agreed to cut production for the first time since 2008.
  • Dollar General Corp. slipped 5 percent after the dollar-store chain’s earnings and sales for the fiscal third quarter trailed analyst estimates.
  • Guess? Inc. plunged 10 percent after the apparel maker cut its fiscal-year earnings forecast by about 30 percent after reporting third-quarter profit that trailed analyst forecasts.
  • B/E Aerospace Inc. slid after a proposed $6.4 billion purchase of the aircraft-parts maker by Rockwell Collins ran into opposition from the activist investor Starboard Value.
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