NEW YORK The five largest U.S. technology companies may have lost enough market capitalization over the past week to buy plane maker Boeing, but the benchmark S&P 500 stock index .SPX has managed to remain within a stone's throw of its record high. <\/p>\n
Apple By Thursday the S&P 500 technology index .SPLRCT had seen its largest five-day drop in a year. <\/p>\n The slide was again led by sector heavyweights Apple and Alphabet, as investors moved away from what had been the year's best-performing sector and rotated portfolios into stocks that pay higher dividends amid some signs that U.S. economic weakness. <\/p>\n I think its a perfectly normal backing off. Tech has done really well. All of sudden everyone wakes up and says, Holy cow, maybe were getting ahead of ourselves, and backs off a little bit,\" said Brad McMillan, Chief Investment Officer for Commonwealth Financial in Waltham, Massachusetts. <\/p>\n Among technology stocks hit, shares of Google's parent Alphabet fell 0.8 percent Thursday after broker Canaccord Genuity downgraded its rating of the stock to \"hold\" from \"buy.\" <\/p>\n The broker downgrade triggered a broader technology sector selloff according to Kim Forrest, senior equity research analyst at Fort Pitt Capital Group in Pittsburgh. <\/p>\n Apple shares slid 0.6 percent on Thursday, extending their five-day decline to 6.9 percent. Barclays analyst Mark Moskowitz wrote that Apple is near the peak valuation levels in its iPhone 6 cycle which \"could mean a bumpy ride lower\" if the prospects for sales of its next phone disappoint. <\/p>\n Shares of social media company Snap Inc (SNAP.N) closed at their initial public offering price of $17 for the first time. <\/p>\n Some investors were selling technology shares to rotate into other sectors, such as beaten-down energy stocks, said Russ Koesterich, co-portfolio manager of BlackRocks Global Allocation Fund. Its more the winners into the losers, rather than a broader move toward safety, he said. <\/p>\n The recent decline notwithstanding, the technology sector remains the best performing so far this year, up 17.4 percent versus the overall S&P 500 index gain of 8.6 percent. <\/p>\n ROTATION TO VALUE AMID WEAK U.S. ECONOMIC DATA <\/p>\n Companies including Apple and Google parent Alphabet have seen their stock prices soar in 2017, and their heavy weightings in benchmark stock indexes prompted concerns that overall market gains are too concentrated in a handful of large technology firms. <\/p>\n \"We had sensed over the last 4-5 weeks that clients were becoming uncomfortable with the clustering of returns to the S&P 500\", said Julian Emanuel, executive director of U.S. equity and derivatives strategy at UBS Securities. \"It felt to us that you had the elixir for a correction in the (technology) sector.\" <\/p>\n Concern over the earlier gains in technology stocks this year has been compounded by some recent weak U.S. economic data. <\/p>\n Last month, the U.S. economy added 138,000 jobs, well below the expected gain of 185,000. On Wednesday, the Commerce Department said Wednesday that retail sales fell 0.3 percent in May, marking the largest one-month decline since January of last year. Also, the Labor Department said its Consumer Price Index dipped 0.1 percent last month, the second drop in inflation in three months. In the 12 months through May, the CPI rose 1.9 percent, the smallest increase since last November. <\/p>\n U.S. Treasury yields tumbled to their lowest since early November on Wednesday on the weak data. <\/p>\n \"Tech is one of the losing sectors when the interest rate trade is dominating because rates are falling,\" said Brian Nick, chief investment strategist at TIAA Investments, an affiliate of Nuveen, because investors need to look for higher yield in dividend paying stocks. <\/p>\n RESILIENCE IN S&P 500 BENCHMARK <\/p>\n Despite the 3.7 percent drop for technology stocks .SPLRCT over the past five sessions, the S&P 500 .SPX index has barely budged, slipping just 0.05 percent over the same period. <\/p>\n The resilience in the S&P 500 benchmark has resulted from investors rotating their portfolios into other sectors such as financials and the more defensive sectors like real estate .SPLRCR. <\/p>\n \"It definitely feels like a rotation that's gone on for a few days with tech being weakened,\" said Edward Perkin, chief equity investment officer at Eaton Vance. \"What's done well in the last few days is the more bond-like plays.\" <\/p>\n (Additional reporting by Sinead Carew in New York and Noel Randewich in San Francisco; editing by Clive McKeef) <\/p>\n TORONTO The Canadian accused of helping Russian intelligence agents break into email accounts as part of a massive 2014 breach of Yahoo accounts may waive his right to fight a U.S. extradition request, his lawyer said on Friday. <\/p>\n NEW YORK U.S. technology company The Bitfury Group said on Friday it had formed a strategic partnership with advisory firm Risk Cooperative to use the blockchain digital ledger in the $60 billion insurance broking market. <\/p>\n <\/p>\n Read the original: <\/p>\n US tech stocks shaken, but market not stirred - Reuters<\/a><\/p>\n","protected":false},"excerpt":{"rendered":" NEW YORK The five largest U.S. technology companies may have lost enough market capitalization over the past week to buy plane maker Boeing, but the benchmark S&P 500 stock index .SPX has managed to remain within a stone's throw of its record high. 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