Big Tech Selloff Prompts "Fear Gauge" Spike

Yellen's interest rates comments spooked investors this afternoon

Digital Content Manager
May 4, 2021 at 4:30 PM
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After trading deep in triple-digit territory the entire day, the Dow managed a frantic late-afternoon surge to finish marginally higher. But for most of the session, a Big Tech selloff and cautionary interest rate comments from U.S. Treasury Secretary Janet Yellen took a toll on Wall Street.

The S&P 500 finished in the red, while the tech-heavy Nasdaq registered its third-straight loss, with FAANG names all shedding at least 1%. Amid growing concerns over rising inflation, Wall Street's "fear gauge," the Cboe Volatility Index (VIX), surpassed the 20 level for the first time since March.

Continue reading for more on today's market, including:

  • This video game name lagged ahead of earnings.
  • An oral Covid-19 vaccine update sends VXRT surging.
  • Plus, high costs weigh on iRobot stock; XPO shrugs off guidance boost; and unpacking Pfizer's quarterly results.

The Dow Jones Industrial Average (DJI - 34,133.03) rose 19.80 points, or 0.06% for the day. Dow Inc (DOW) led the Dow components with a 2.6% rise, while Apple (AAPL) paced the laggards, falling 3.5%.

Meanwhile, the S&P 500 Index (SPX - 4,164.66) dropped 28 points, or 0.7% for the day. The Nasdaq Composite (IXIC - 13,633.50) fell 261.6 points, or 1.9% for the day.

Lastly, the Cboe Volatility Index (VIX - 19.48) added 1.2 point, or 6.4% for the day.

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  1. Goldman Sachs (GS) CEO David Solomon is asking employees to return to the office by June 14, as Covid-19 cases in the country continue to decline. (CNBC)
  2. Ridesharing giant Uber (UBER) announced it is partnering with electric car maker Arrival (ARVL) to develop a new vehicle with input from its drivers. (MarketWatch)
  3. How rising costs overshadowed iRobot's top-line beat.
  4. XPO Logistics stock failed to capitalize on earnings win.
  5. Pfizer stock dipped despite boosting guidance on strong vaccine revenue.

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Gold Dips After Yellen's Comments Boost U.S. Dollar

Oil prices jumped on Tuesday, as investors became optimistic the easing of Covid-19 restrictions in the U.S. and the U.K would create additional demand for the commodity. More specifically, the European Commission is considering allowing fully vaccinated travelers and tourists from countries with “a good epidemiological situation." In turn, June-dated crude rose $1.20, or 1.9%, to settle at $65.69 per barrel. 

Gold prices finished lower, however, on the heels of Yellen's comments suggesting the Federal Reserve may need to hike interest rates up. Strength in the U.S. dollar following her remarks may have undercut they yellow metal. In response, June-dated gold dipped $15.80, or 0.9%, to settle at $1,776 an ounce.  

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