Technology Weakness Weighs On Stocks -- WSJ

By Akane Otani and Georgi Kantchev Features Dow Jones Newswires

The Nasdaq Composite posted another session of declines as technology stocks resumed their slide.

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Thursday's moves sent the index, which has outperformed the S&P 500 and Dow Jones Industrial Average this year, lower for the fourth time in the past five trading days.

U.S. stocks have hit a string of records this year, in part due to stronger-than-expected corporate earnings. But many investors are cautious, pointing to risks including elevated stock valuations and a recent patch of soft economic data.

"The U.S. economy looks quite dull at the moment," said Neil Dwane, global strategist at Allianz Global Investors. Despite falling unemployment, inflation is still low and the economy is struggling to grow in the "uninspiring" 1% to 2% range, he said.

The Dow Jones Industrial Average fell 14.66 points, or less than 0.1%, to 21359.90 on Thursday. The S&P 500 fell 5.46 points, or 0.2%, to 2432.46, and the Nasdaq Composite lost 29.39 points, or 0.5%, to 6165.50.

Tech stocks, which have outperformed the S&P 500 this year as investors bet on fast-growing companies, resumed a recent spurt of weakness, falling 0.5% in the broad index.

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Shares of Snap narrowly avoided falling below their March IPO price of $17. The parent of disappearing-message app Snapchat ended the day down 88 cents, or 4.9%, at $17.

Energy stocks, the year's worst-performing S&P 500 sector, fell 0.7% as oil prices declined a second straight session. U.S. crude for July delivery lost 0.6% to $44.46 a barrel, its lowest settlement since November.

The U.S. dollar climbed a day after the Federal Reserve decided to raise benchmark interest rates -- signaling that it would stick to its plans to gradually tighten monetary policy despite signs of cooling inflation. A U.S. consumer-inflation reading released Wednesday came in weaker than expected.

The WSJ Dollar Index, which measures the dollar against a basket of 16 currencies, rose 0.6%.

Government bonds fell, with the yield on the 10-year U.S. Treasury note rising to 2.160% from 2.138% on Wednesday. Yields rise as bond prices fall.

While "there is some concern around inflation, the fundamental picture hasn't changed," said Victor Jones, director of trading at TD Ameritrade. "We're still cautiously optimistic."

Earlier, the Bank of England held interest rates steady and left the pace of its asset purchases unchanged, a move investors said was widely expected.

Still, three of eight officials on BOE's Monetary Policy Committee voted for a rate increase -- a sign that the U.K. central bank has moved a step closer to withdrawing the emergency stimulus it put in place after last year's Brexit referendum.

The Stoxx Europe 600 lost 0.4%, weighed down by the tech and basic-resources sectors.

Stock indexes across Asia mostly ended lower. Hong Kong's Hang Seng Index fell 1.2%, while Japan's Nikkei Stock Average declined 0.3%.

Write to Akane Otani at akane.otani@wsj.com and Georgi Kantchev at georgi.kantchev@wsj.com

(END) Dow Jones Newswires

June 16, 2017 02:47 ET (06:47 GMT)