By Stewart Lewis
(May 10 – 17:00 EY) – Nervous investors pushed the NASDAQ deep into negative territory for the third consecutive day. The NASDAQ Composite plunged 199.88 points, or 5.6%, to 3,385.13. The index has lost a hefty 11.3% this week. Concerns over high valuations in many large-cap tech stocks, as well as trepidation ahead of next week’s U.S. Federal Reserve meeting is keeping investors on the sidelines.
In the broader market, safe haven sectors such as utilities and gold gained ground. Bank and brokerage shares fell.
The Dow Jones industrial average slid 168.97 points to 10,367.78. The Dow’s downside leaders were Intel, Citigroup, IBM, United Technologies and General Motors. Wal-Mart was the blue-chip upside leader with a gain of 7%.
Microsoft shares fell 3/8 to 67 7/16. The software giant has asked the court hearing its anti-trust case to toss out the government’s breakup proposal.
The Toronto Stock Exchange 300 composite index fell more than 2.5% at the mid-point of Wednesday’s session as investors sold off tech stocks ahead of next week’s anticipated U.S. rate hike. Traders are worried that the techs might be worth even less in a high-interest rate environment. Nortel was off C$5.60 to C$73.60.
TSE trading was heavy — 97.8 million shares worth $2.2 billion. Eight of 14 sub-groups slid, led by a 5.9-per cent drop in the tech-laden industrials. Decliners outran advancers 597 to 392.
The CDNX dropped 83.5 finishing up at 3366.2.