Amazon sinks as US tech stocks continue to slide
Technology shares, which helped power the rise of the US stock market last year, are pulling it lower now.
The tech-rich Nasdaq index dropped 0.85% or almost 60 points to 6,949.2 on Wednesday, driven by declines in firms such as Amazon, Tesla and Broadcom.
It continued a multi-week sell-off spurred by calls for tighter regulation of tech firms, competition concerns and questions over autonomous driving.
The S&P 500 lost 0.3% to 2,605 while the Dow was flat at 23,848.4.
Shares see-sawed throughout the day, extending a streak of sharp swings in prices that have rocked markets in recent weeks.
The information technology sector on the S&P 500, which includes firms such as Apple, Microsoft and Intel, has fallen more than 6% this month, mostly in the last two weeks.
Analysts said the decline reflects a confluence of factors, including a desire to lock in gains notched last year when technology stocks surged.
A host of other factors - many of them political - is fuelling uncertainty, including trade tension between the US and China, where many technology companies have ties.
The Trump administration has also shown a willingness to intervene in the private sector, calling for anti-trust scrutiny of AT&T's purchase of Time Warner and moving to block Broadcom's takeover of Qualcomm in the name of national security.
A report that US President Donald Trump wants to use anti-trust law or another government power to limit Amazon's expansion added to the worries on Wednesday.
News portal Axios reported that President Donald Trump is "obsessed" with regulating the e-commerce giant.
Tuna Amobi, senior media analyst at CFRA Research, said he thinks some of the reaction to the Amazon report is "overdone" but reflects wider unease about the current market.
"You kind of put all these pieces together and it gives you a sense of a little bit more trepidation out there in the tech space in general," he said.
Amazon shares closed Wednesday down 4.4%, continuing Tuesday's slide. The firm's stock is still up more than 60% from a year ago.
Chipmaker Broadcom sank more than 3%, extending declines from recent weeks.
Tesla shares fell another 7%, a day after US safety regulators said they were investigating a recent crash. A decision by ratings agency Moody's to downgrade its credit rating also had an impact.
The electric car maker's shares have lost close to 27% in March.
Conversely Facebook shares ended Wednesday on a positive note, eking out a 0.5% gain.
The social media firm's stock has fallen by almost 20% in recent weeks, following allegations that leaked user data was exploited for political purposes.
In another reversal of fortunes, shares of traditional retailers - which were hammered by doubts last year - were among the winners. Macy's gained 4.3%, while Walmart rose 2%.