Shares of technology companies tumbled.
Investors have fled the sector to start the year, piling into shares of cyclical companies that would benefit from an improving economy. The pivot from the Federal Reserve has pushed bond yields higher, which in turn has weighed on technology firms whose future earnings become less attractive when compared with bonds with rising yields.
Of the 17 software companies within the S&P 500's information technology sector, 14 have fallen this week.
Salesforce.com shares sank more than 8%, continuing a recent stretch of losses that have pulled the software giant's stock to the lowest levels in months. UBS analysts on Tuesday downgraded Salesforce shares to a neutral rating from a buy and lowered their price target on the stock.
Meanwhile, Hong Kong-listed Chinese tech firms fell again. The drop came after Beijing passed new rules tightening controls on tech companies' overseas listings and activities, and after Tencent sold a $3 billion stake in Sea, one of its highflying affiliates.
Write to Amy Pessetto at amy.pessetto@dowjones.com
(END) Dow Jones Newswires
01-05-22 1724ET
