(Reuters) – Losses in technology stocks weighed on Wall Street’s main indexes on Tuesday as investors booked profits following the recent strong run and uncertainty in Washington after another high-profile exit from the Trump administration.
Technology stocks .SPLRCT have rallied 11 percent this year, the most among major 11 S&P sectors.
U.S. President Donald Trump fired Secretary of State Rex Tillerson after a series of public rifts over issues including North Korea and Russia.
Tillerson’s exit comes just a week after the departure of chief economic adviser Gary Cohn in the wake of a surprise turn toward new trade tariffs on steel and aluminum.
Trump also said he was considering conservative commentator Larry Kudlow“very strongly” to become his next top economic adviser.
“Technology rallied hard yesterday and last week, and there is profit-taking, but it’s just a short-term pressure,” said Ken Polcari, director of the NYSE floor division at O’Neil Securities in New York.
“There’s a lot of noise coming out of Washington over all these changes that’s causing the markets to really not focus.”
The markets opened higher after data showed U.S. consumer price growth slowed in February, an indication that an anticipated pickup in inflation probably will be only gradual.
“It certainly presents some more difficult questions for the central bank if they look to embark on a more aggressive interest rate hiking cycle next week,” said Aaron Kohli, interest rate strategist, BMO Capital Markets in New York.
“How do they expect to get inflation materially higher if they are already starting to see some signs of spotty weakness?”
At 12:45 p.m. ET, the Dow Jones industrial average .DJI was down 25.78 points, or 0.1 percent, at 25,152.83, the S&P 500 .SPX was down 6.01 points, or 0.22 percent, at 2,777.01 and the Nasdaq Composite .IXIC was down 44.76 points, or 0.59 percent, at 7,543.57.
U.S. Treasury yields fell in response to the data and Tillerson’s exit. [US/]
Among stocks, General Electric (GE.N) fell about 4 percent after JPMorgan cut its price target on the stock to $11 from $14, saying the industrial conglomerate was not a“safety stock” in a volatile market.
Declining issues outnumbered advancers on the NYSE by 1,462 to 1,349. On the Nasdaq, 1,634 issues fell and 1,176 advanced.
Reporting by Sruthi Shankar in Bengaluru; Editing by Arun Koyyur
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