Software ETF sinks 5.4%, worst day since February 2016
Tech stocks got hammered Monday, leading the broader market lower as the software sector experienced its worst selloff in nearly three years.
On Monday, tech stocks were the worst performing sector of the S&P 500 index’s SPX, -1.66% 11 sectors, dropping 3.8%, as the index closed down 1.7%, and the Technology Select Sector SPDR ETF XLK, -4.68% finished down 3.8%. Tech stocks have had a rough time since the beginning of October as the sector has seen three other sessions of 3%-or-more losses since Oct. 10.
The tech-heavy Nasdaq Composite Index COMP, -3.03% fell 3%. Additionally, the Dow Jones Industrial Index DJIA, -1.56% finished down 1.6%. Common to all those, shares of Apple Inc. AAPL, -1.88% closed down 4% following a report that the company was planning a second round of iPhone production cuts.
The heaviest losses in tech, however, appeared to show up in the software sector. The iShares North American Tech-Software ETF IGV, -5.40% was down 5.4% Monday. One of the hardest-hit stocks in the ETF Monday was Salesforce.com Inc. CRM, -2.24% , which shed 8.7%. For both the ETF and Salesforce, Monday proved to be the worst one-day percentage drop since Feb. 5, 2016, according to FactSet data.
The five heaviest-weighted stocks on the IGV index are Oracle Corp. ORCL, -3.17% , Microsoft Corp. MSFT, -1.31% Adobe Inc. ADBE, -1.76% , Salesforce and Intuit Inc. INTU, -5.77% .
Cybersecurity stocks weren’t faring much better as the ETFMG Prime Cyber Security ETF HACK, -4.66% fell 4.7%, with shares of Zscaler Inc. ZS, -12.08% , Okta Inc. OKTA, -15.66% , Everbridge Inc. EVBG, -12.57% , Splunk Inc. SPLK, -0.86% and Forescout Technologies Inc. FSCT, -6.41% leading the sector lower with sharp losses.
The battered chip sector PHLX Semiconductor Index SOX, -3.86% fell 3.9%, led lower by the bleed-out of shares of Nvidia Corp. NVDA, -3.80% which dropped 12% Monday, following last week’s 20% loss. Nvidia shares are currently down more than 25% for the year and are 51% off their high of $292.76 set on Oct. 2. Advanced Micro Devices AMD, -3.98% shares finished down 7.5%, and Micron Technology Inc. MU, -5.62% shares fell 6.7%,
The First Trust Cloud Computing ETF SKYY, -3.53% which includes VMware Inc. VMW, -2.30% , Cisco Systems Inc. CSCO, -0.11% and Juniper Networks Inc. JNPR, -1.85% , fell 3.6%, while other cloud stocks such as Dropbox Inc. DBX, -0.65% , Box Inc. BOX, -6.93% , Atlassian Corp. TEAM, -8.74% and Workday Inc. WDAY, -0.86% all fell 7% or more Monday.
In comparison, here’s how the broader markets and tech areas have fared on the year: