By Caroline Valetkevitch
NEW YORK (Reuters) – U.S. stocks fell on Tuesday and the Nasdaq was on track for its biggest daily drop since mid-May as investors were cautious ahead of results from top tech and internet names and Wednesday’s Federal Reserve announcement.
Quarterly results from Apple Inc, Microsoft Corp and Google parent Alphabet Inc are due after the bell, while Amazon.com Inc will report results on Thursday. The shares of these companies – the four largest U.S. companies by market value – were all down and weighed the most on the Nasdaq and S&P 500.
Also, electric-car maker Tesla Inc fell 2.3%, following its late Monday results.
Shares of tech and internet companies have run up recently and last week regained leadership of the market.
“Expectations are so high. They’re going to have good numbers … but we are expecting much more or maybe they will talk down the second half of the year,” said Paul Nolte, portfolio manager at Kingsview Investment Management in Chicago.
Adding to the cautious tone is the outlook for U.S.-listed Chinese stocks, he said. The shares extended losses as fears over more regulations in the mainland persisted.
Caution was also high as the Fed began its two-day meeting, with investors looking for signs on when it intends to begin reining in its massive stimulus program.
The Dow Jones Industrial Average fell 158.62 points, or 0.45%, to 34,985.69, the S&P 500 lost 32.42 points, or 0.73%, to 4,389.88 and the Nasdaq Composite dropped 223.42 points, or 1.51%, to 14,617.29.
In another sign that investors were taking off risk, defensive sectors such as real estate and utilities were among the best-performing S&P 500 segments for the day, while U.S. Treasuries prices rose. [US/]
Intel Corp sank 2.8% after it said its factories would start building Qualcomm chips and laid out a road map to expand its new foundry business.
Graphic: Nasdaq retreats sharply from record highs: https://fingfx.thomsonreuters.com/gfx/mkt/mopanmqwnva/Pasted%20image%201627401270150.png
Declining issues outnumbered advancing ones on the NYSE by a 2.46-to-1 ratio; on Nasdaq, a 3.02-to-1 ratio favored decliners.
The S&P 500 posted 41 new 52-week highs and no new lows; the Nasdaq Composite recorded 34 new highs and 228 new lows.
(Reporting by Caroline Valetkevitch in New York; Additional reporting by Ambar Warrick in Bengaluru; Editing by Maju Samuel and Matthew Lewis)
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