US stocks ended sharply lower on Wednesday, erasing the Dow and the S&P 500’s gains for the year and putting the Nasdaq into correction territory, amid rising concerns about a slowdown in the global economy and disappointing forecasts from chipmakers.
The Dow Jones Industrial Average fell 608 points, or 2.41%, to 24,583, the S&P 500 lost 85 points, or 3.09%, to 2,656 and the Nasdaq Composite dropped 329 points, or 4.43%, to 7,108.
Investors were worried after chipmakers Texas Instruments and STMicroelectronics warned of slowing demand. They followed disappointing forecasts on Tuesday from Caterpillar.
Texas Instruments fell 8.2%, helping pull the Philadelphia Semiconductor index down 6.6% in its biggest daily percentage drop since October 2014. Intel, due to report earnings later this week, fell 4.7%.
Meanwhile, data showed sales of new US single-family homes fell to a near two-year low in September, the latest sign that rising mortgage rates and higher prices were hurting demand for housing.
Adding to weaker sentiment in late trading, the Federal Reserve said in a report on the economy that US factories have raised prices because of tariffs.
Freeport-McMoRan Inc. shares skidded 7.8% after the metals and mining company surpassed analysts’ estimates for third-quarter sales and profits.
Shares of United Parcel Service Inc. fell 5.5%, following the announcement that the firm met third-quarter profit expectations, but came up a bit shy on revenue.
Shares of AT&T Inc. shed 8.1% after the telecommunications and media giant reported third-quarter earnings that missed expectations but sales that beat.
Hilton Worldwide Holdings Inc. fell 7.3% after reporting third-quarter revenue below analysts estimates.
On the positive side, Boeing Co. shares rose 1.3% after the company reported earnings and revenue that beat Wall Street expectations.
The beaten-down S&P technology sector retreated another 4.4%. After the closing bell, Microsoft added 2.7% following the release of its results.