By Yasin Ebrahim
Investing.com – The Dow slumped Tuesday, dragged lower by large-cap tech stocks amid souring U.S.-China relations.
The Dow Jones Industrial Average fell 2.04%, or 572 points. The S&P 500 was down 2.54%, while the Nasdaq Composite slumped 3.67%.
Apple (NASDAQ:AAPL) led the rout in FAANG stocks, dropping 5%. The selloff in Apple comes amid growing speculation over whether the company will launch its new iPhones at its event on Sept. 15.
Apple's legal battle with Fortnite maker Epic Games intensified as the iPhone maker said it had countersued the games' maker, alleging breach of contract.
"While the launch and 5G smartphones hitting the shelves will be in October, we continue to believe the official virtual unveiling of this linchpin product launch will be in late September with an announcement out of Cupertino in the next few weeks," Wedbush said in a note earlier this week.
Chip stocks also played a role in the selloff, with the Philadelphia Semiconductor Index down 4%. The Trump administration is reportedly looking at adding Chinese chip giant, SMIC, to the Commerce Department’s "Entity List," which would bar it from doing business with U.S. firms.
Energy stocks plunged into the red, down 4% as U.S. oil prices sank more than 8% as ongoing concerns about the strength of demand persisted.
In other news, Tesla (NASDAQ:TSLA) fell 19% after the electric automaker failed to make the cut for inclusion into the S&P 500 index despite recording a fourth consecutive quarterly profit earlier this year.
Tesla rival Nikola (NASDAQ:NKLA) surged 40% after the electric truck maker announced that General Motors (NYSE:GM) had taken an 11% stake in the company that would see GM produce the electric truck maker’s hydrogen fuel cell electric truck, the Badger, by the end of 2022.
Boeing (NYSE:BA), meanwhile, slid 4% as the company reported that the U.S. aviation authority began a probe into manufacturing flaws in the Boeing 787.
The company reported a total of 13 deliveries last month as inspections from manufacturing faults of its 787 Dreamliner jets halted order activity.