(Bloomberg) – U.S. stock indexes dropped, led by technology shares, as Apple Inc. tumbled on signs of weak iPhone demand. The dollar rose, oil halted a 10-day sell-off and the pound slid as the U.K's premier fought to save her Brexit divorce plan.
The S & P 500 index and Dow Jones Industrial Average were trading close to session Monday afternoon, while the Nasdaq 100 dropped for the third day and the Russell 2000 small-cap benchmark erased its gains for the year. Major suppliers for Apple fell as investors fretted about one of the most important product lines in the technology sector, and U.S. chip stocks followed suit. General Electric Co. extended a rout after its chief executive officer's attempt to reassure investors fell flat. California utilities plunged as wildfires swept the state.
"FANG was the leader on the way up," said Kim Forrest, senior portfolio manager at Fort Pitt Capital. "It seems to be the leader on the way down, and the supplier chain seems to have a lot to do with that."
The dollar rallied versus most of its major peers and crude oil advanced as OPEC and its allies began laying groundwork to cut in 2019. The pound declined for a third day as pressure built on U.K. Prime Minister Theresa May to ditch her Brexit plan, while the euro slumped to its weakest level in more than 16 months ahead of potential stress around Italy's budget. Italian bonds fell as much euro zone zone edged higher, while Treasuries did not trade because of U.S. federal holiday.
Investors have a lot on their plate right now, from deciding whether the recent earnings season was a peak to watching Brussels, where the European Commission is ready to escalate a war with Italy over its budget deficits, and China, which produces key economic data on Wednesday. There's also a renewed debate on the direction of bond yields – traders have been calling down inflation expectations before U.S. Consumer price data on Wednesday, which may offer the next clues on the trajectory of borrowing costs.
The Stoxx Europe 600 Index was led downward by tech and personal goods shares. The benchmark gauge in Asia retreated, although stocks in Japan and Hong Kong finished in a tight range and those in China jumped. Emerging-market stocks and currencies fell. Bitcoin headed for its first advance in three sessions.