Nasdaq closes at 2-year low on Monday, hurt by slumping chip stocks
Stocks closed lower on Monday with the Nasdaq Composite index falling to the lowest level in two years as tech shares continue to be the hardest hit in this bear market because of spiking interest rates. The Nasdaq Composite closed 1.04% lower at 10,542.10, hitting its lowest close since July 2020, weighed down by a slump in semiconductor stocks such as Nvidia
and AMD. The S&P 500 also fell 0.75% to 3,612.39 dragged down by semi stocks and dips in major tech names like Microsoft, while the Dow Jones Industrial Average shed 93.91 points, or 0.32%, to close at 29,202.88.
The declines came as JPMorgan CEO Jamie Dimon warned that the U.S. would likely fall into a recession in 2023, and that it may not be just a mild economic contraction as some economists have projected.
A policy change weighed on semiconductor stocks after the Biden administration announced new export controls that limit U.S. companies selling advanced computing semiconductors and related manufacturing equipment to China. Tech shares have also been hit the hardest in this sell-off as rising rates expose their relatively high valuations and raise their cost of capital.
The pan-European Stoxx 600 provisionally ended down 0.25%, with major bourses closing mixed. Technology stocks led losses, finishing the session down 1.7%. Meanwhile retail and chemicals stocks both closed up around 1.7%.
British packaging company DS Smith saw its shares jump more than 8% in early trade after projecting that annual performance ahead of expectations, on the back of robust revenue growth and cost-cutting measures. At the bottom of the Stoxx 600, ams-Osram shares fell more than 9% after announcing that its CFO plans to step down from April 2023.
Source: CNBC, Investing.com