Wall Street drops with tech-related shares, investors assess rate outlook
U.S. stocks fell on Friday, led by technology-related megacaps that have propelled this year's rally, while investors weighed the interest rate outlook ahead of next week's Federal Reserve meeting.
Traders have reined in bets of a June rate cut by the Fed after this week's hotter-than-expected inflation data.
Shares of Adobe dropped 13.7%, a day after it forecast second-quarter revenue below analysts' estimates, citing competition and weak demand for its artificial intelligence-integrated photography, illustration and video.
The S&P 500 technology index was down 1.3% on the day, leading declines among sectors. Microsoft fell 2.1% and was among the biggest drags on the index.
An index of semiconductors was down 0.5% on Friday and registered its biggest weekly percentage decline since early January. The Nvidia GTC developer conference scheduled for March 18 to 21 will be watched closely for AI-related announcements.
«We seem in a period here where everyone knows rates eventually will be lowered. The expectation of when it happens keeps getting slightly pushed back, but investors still believe it will happen,» said Rick Meckler, partner at Cherry Lane Investments in New Vernon, New Jersey.
«It's been a back-and-forth market as people reposition and consider whether some of the real winners have just gone a little bit too far, so you're seeing them trade off.»
The Dow Jones Industrial Average fell 190.89 points, or 0.49%, to 38,714.77. The S&P 500 lost 33.39 points, or 0.65%, at 5,117.09 and the Nasdaq Composite
