Investing.com - A wave of selling pressure emerged across tech stocks Thursday as semiconductor stocks slumped on fears over a wobble in the industry, while the threat of increased regulation sent Facebook and Twitter tumbling.
The Dow Jones Industrial Average rose about 0.08%. S&P 500 fell 0.37%, while the Nasdaq Composite fell about 0.91%.
Semiconductor companies sounded the alarm on the stability of industry, warning that margins would likely be knocked by falling DRAM (memory chip) prices and oversupply in NAND (flash memory) products as demand wanes.
Nanya delivered the first blow earlier this week, when it provided a cautionary outlook for server DRAM for the fourth quarter. Both Micron Technology (NASDAQ:MU) and KLA-Tencor (NASDAQ:KLAC) exacerbated those concerns, as the latter said that its December quarter "would be up less than thought," owing to weakness in the memory market.
Morgan Stanley (NYSE:MS), meanwhile, delivered another blow to semiconductors, asserting that "memory markets have worsened in recent weeks," as "too much supply" is weighing on NAND, while inventory and prices pressures were curbing demand for DRAM.
Tech was thrown into further disarray amid an ongoing slump in a well-known cohort of large-cap tech stocks on concerns that lawmakers were ready to pull the trigger on plans to increase regulation, which many fear could keep a lid on profits of tech companies.
Facebook (NASDAQ:FB), Alphabet (NASDAQ:GOOGL) and Twitter (NYSE:TWTR) sunk for a second-straight day, leaving tech on course to end the week nursing a 2% loss.
Late drama unfolded on the trade front, as President Donald Trump told a columnist for The Wall Street Journal that Japan was next in his crosshairs, further exacerbating fears of a global trade war.
This comes as the United States and Canada continued talks on reaching an agreement on NAFTA revamp after reportedly working late into the night on Wednesday.
Traders were also awaiting confirmation on whether Trump would impose levies on $200 billion more of Chinese imports on Thursday when a public comment period on the new tariffs ends.
Energy, meanwhile, also contributed to the plunge in stocks as oil prices were pressured by a government report showing a large increase in fuel stockpiles, which offset a draw in crude supplies.
On the New York Mercantile Exchange crude futures for October delivery fell 1.4% to settle at $67.64 a barrel.
On the corporate news front, CBS (NYSE:CBS) CEO Les Moonves is reportedly set to leave the media company with a potential $200 million payoff. This comes after Moonves, acknowledged “mistakes” in the way he had treated women in the early throes of his career.
Ahead of the all-important nonfarm payrolls report due Friday, private sector job data did little boost investor hopes for an upbeat report as private sector job creation in August, undershot economists' expectations.
Top S&P 500 Gainers and Losers Today:
General Mills (NYSE:GIS), CBS (NYSE:CBS) and Royal Caribbean (NYSE:RCL) were among the top S&P 500 gainers for the session.
Micron Technology (NASDAQ:MU), KLA-Tencor (NASDAQ:KLAC) and Wynn Resorts (NASDAQ:WYNN) were among the worst S&P 500 performers of the session.