Dow dives, weighed down by tech stocks

Apple shares fell 5%, adding to investors concerns about the tech sector. Ben Phillips, Chief Investment Officer at EventShares, on what's causing weakness in tech.

Posted: Nov 13, 2018 4:59 AM
Updated: Nov 13, 2018 4:59 AM

Why are stocks falling again? President Donald Trump says it's because Democrats are gearing up to use their impending control of the House of Representatives to investigate him. As always, when it comes to the markets, the real answer is complicated.

The Dow fell as much as 511 points on Monday, dragged down by investors' concerns about the tech sector and the rising dollar. By mid-afternoon, the Dow was down 400 points. The Nasdaq fell 2% and the broader S&P 500 fell 1.2%.

Apple (AAPL) fell 5% after supplier Lumentum cut its earnings and sales forecast because of weak demand, and JPMorgan cut its target price on Apple's stock. That weighed on other technology stocks, including Amazon (AMZN) and Tesla (TSLA) -- down 4% -- as well as Facebook, which fell 3%. Google (GOOGL), Netflix (NFLX) and Microsoft (MSFT) were all down more than 2%.

The strong dollar also weighed on stocks. The US currency surged to a 16-month high because investors fear the European economy could stall if no Brexit deal is reached this week. Prospects of another rate hike from the Fed next month have also helped lift the dollar. The rising dollar is a signal of a strong economy, but it hurts sales and profits for American companies that do business overseas.

Though Trump blamed Democrats for the drop, the Dow had actually bounced back since the midterms, rising last week in its best showing since March. Wall Street tends to like stagnation in Washington, so investors are actually just fine with Democrats taking the House.

As for what Trump termed the "prospect of presidential harassment," there is not much evidence the stock market will bat an eye if Democratic leaders in the House begin investigations into the Trump administration. Stocks rose before, during and after President Bill Clinton's impeachment.

Stocks fell in the run-up to President Richard Nixon's impeachment proceedings and for a few months after he resigned. But the economy was in recession at the time.

The stock market had risen steadily after Trump's election through 2017. But hiccuped in January 2018 after Trump introduced the first of many tariffs aimed at growing the US steel industry and reducing America's purchases of foreign-made products.

Stocks rebounded in the middle of the year but have swooned again because investors are worried about rising rates -- and a mountain of debt caused by the tax cut bill that higher rates will make more expensive to pay off.

Mississippi Coronavirus Cases

Data is updated nightly.

Confirmed Cases: 116617

Reported Deaths: 3283
CountyConfirmedDeaths
Hinds7987178
DeSoto713479
Harrison527284
Jackson462285
Rankin398286
Madison383794
Lee360080
Forrest306978
Jones295784
Washington259299
Lafayette251343
Lauderdale2485135
Lamar227138
Oktibbeha202854
Bolivar201977
Neshoba1854111
Lowndes180262
Panola170240
Leflore168787
Sunflower163449
Warren155156
Monroe152173
Pontotoc147920
Marshall145329
Lincoln141157
Pike139256
Copiah138136
Scott125729
Coahoma125437
Grenada122639
Yazoo122634
Simpson121749
Union119225
Tate117739
Leake115242
Holmes114960
Itawamba114825
Pearl River114560
Adams108944
Prentiss106920
Wayne102022
Alcorn101112
George99919
Covington97927
Marion95443
Tippah91323
Newton86927
Chickasaw85726
Hancock85028
Tallahatchie84526
Winston84421
Tishomingo81641
Attala79726
Clarke76151
Clay70021
Jasper69117
Walthall64027
Calhoun62612
Noxubee59917
Smith59616
Montgomery55223
Yalobusha54914
Claiborne53816
Tunica53517
Lawrence52514
Perry49823
Carroll49312
Greene47818
Stone47714
Humphreys44916
Amite42513
Quitman4206
Jefferson Davis41211
Webster37613
Benton3456
Wilkinson33820
Kemper32715
Sharkey28514
Jefferson27710
Franklin2463
Choctaw2086
Issaquena1074
Unassigned00

Alabama Coronavirus Cases

Confirmed Cases: 159439

Reported Deaths: 2699
CountyConfirmedDeaths
Jefferson23443377
Mobile16934315
Tuscaloosa10414140
Montgomery10298197
Madison939496
Shelby743663
Baldwin669469
Lee655065
Calhoun462161
Marshall441150
Etowah431251
Morgan418235
Houston418034
DeKalb346129
Elmore322753
St. Clair299942
Limestone289330
Walker282392
Talladega267435
Cullman250824
Lauderdale231342
Jackson217515
Autauga207431
Franklin206131
Colbert204132
Russell19533
Blount194225
Chilton189332
Dallas187227
Coffee179511
Dale177251
Covington175529
Escambia173030
Clarke135317
Chambers135244
Pike134413
Tallapoosa133087
Marion109729
Barbour10339
Marengo102522
Butler101340
Winston93713
Geneva9167
Lawrence86132
Pickens86018
Bibb84314
Randolph82916
Hale77730
Clay74912
Washington74912
Cherokee74514
Henry7196
Lowndes71428
Bullock64917
Monroe64810
Crenshaw60930
Perry5936
Fayette58413
Cleburne5738
Wilcox57012
Conecuh56113
Macon53720
Lamar5065
Sumter47321
Choctaw39212
Greene34616
Coosa2053
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