US tech selloff batters stocks

Bloomberg

A selloff in US technology stocks spread through Asia and Europe, battering shares from South Korea to the Netherlands. The pound fluctuated as an embattled Theresa May fought to survive the fallout from the British general election.
Samsung Electronics Co., ASML Holding NV and Tencent Holdings Ltd. led declines in Europe and Asia, dragging down benchmark indexes. US stock futures also fell as markets continue to digest the Nasdaq 100’s plunge on Friday. After the biggest drop in eight months, sterling appears caught between the potential benefits of a so-called soft Brexit and the current political uncertainty. Italian bonds rallied as populists took a hit in local elections. Palladium extended its world-beating rally.
The sudden slide in tech stocks, which helped send global equities to repeated record levels this year, blindsided many investors after markets had largely brushed aside last week’s trio of risk events. The question now is whether the drops represent merely a pause or a more fundamental crack in the US stock bull market.
“There’s a chance US internet technology stocks that have propelled a global stock rally will now serve as a buzz kill,” said Mitsuo Shimizu, deputy general manager at Japan Asia Securities in Tokyo.
Meanwhile, in Washington the drama continues. Attorney General Jeff Sessions offered to speak to Senate Intelligence Committee to answer questions about alleged Russ- ian meddling in the 2016 presidential election. And Federal Reserve is set to lift rates, leading a pack of central banks that are mostly nodding in the direction of removing ultra-accommodative policy.
Theresa May will address rank-and-file Tory lawmakers on
Monday, in a meeting that will test her chances of staying in office.
A day later, she’ll meet Northern Ireland’s DUP leader Arlene Foster in a bid to reach a deal to govern together. Sessions will testify before the Senate on Tuesday before the Senate.
Fed policy makers are forecast to raise their benchmark interest rate for the second time this year on Wednesday. Central banks in Japan and Britain are also scheduled to weigh in with policy decisions this week.
Tech shares were the biggest losers on the MSCI Asia Pacific Index, which dropped 0.3 percent. South Korea’s Kospi lost 1 percent, with Samsung Electronics Co. slumping 1.6 percent. Hong Kong’s Hang Seng Index declined 1.2 percent, as Tencent Holdings Ltd. fell 2.5 percent. Markets in Australia, Malaysia and the Philippines were closed for holidays.
The Stoxx Europe 600 Index slid 0.8 percent as of 10:07 a.m. in London, with ASML Holding dropping 4 percent. S&P 500 Index futures dropped 0.3 percent. The benchmark gauge fell 0.1 percent on Friday, while the tech-heavy Nasdaq Composite Index dropped 1.8 percent. Apple sank 3.9 percent, while Microsoft, Amazon, Facebook and Alphabet all lost more than 2 percent.
The pound fell 0.1 percent to $1.2730. The currency lost 1.6 percent on Friday. The euro strengthened 0.2 percent to $1.1222. The Bloomberg Dollar Spot Index fell 0.1 percent after gaining 0.5 percent over the previous three sessions. The yield on 10-year Treasuries was little changed. UK benchmark yields decreased two basis points, after dropping three basis points on Friday. French yields slipped four basis points while those in Germany fell two basis points. Italian 10-year yields tumbled seven basis points.