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March 28, 2018, 4:45 p.m. EDT

Stock market books back-to-back declines as tech shares extend swoon

Final 4th-quarter GDP reading comes in at 2.9%; pending-home sales rose 3.1% in February

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By Mark DeCambre and Barbara Kollmeyer, MarketWatch


AFP/Getty Images
Amazon shares fall into correction territory on Wednesday.

U.S. equity benchmarks finished lower for a second straight session on Wednesday as a withering decline among last year’s most-prominent stock performers helped to unsettle Wall Street sentiment.

Trading was unusually choppy, with the Dow switching in and out of positive territory 29 times and the S&P 500 whipsawing about 59 times on a minute-by-minute basis, according to WSJ Market Data Group. That volatile action came as investors digested upbeat data on U.S. economic growth and home sales, against the backdrop of the battered tech complex.

Read: Will the tech rout wreck the stock-market rally?

Wednesday trading comes in an abbreviated week, with market closed Friday for Good Friday.

See: Which markets are closed on Good Friday?

What are the main benchmarks doing?

The Dow Jones Industrial Average /zigman2/quotes/210598065/realtime DJIA -0.13% lost 9.29 points, or less than 0.1%, to 23,848.42, while the S&P 500 index /zigman2/quotes/210599714/realtime SPX -0.15% slipped by 7.62 points, or 0.3%, to 2,605.00, with energy, tech and consumer-discretionary names, led by a drop in Amazon.com Inc . shares /zigman2/quotes/210331248/composite AMZN -0.54% , weighing.

The tech-focused Nasdaq Composite Index /zigman2/quotes/210598365/realtime COMP +0.0013% declined 59.58 points, or 0.9%, to end at 6,949.23.

All three benchmarks have traded in wide ranges, with the Dow up around 235 points and down by 130 points at the lows, while the Nasdaq shed 1.5% at its nadir and peaked with a intraday peak gain of about 0.4%.

On Tuesday, a tumble for tech equities helped to wallop the overall market. The Nasdaq shed 211.74 points, or 2.9%, to reach 7,008.81, while the Dow dropped 1.4% and the S&P 500 index fell 1.7%.

Investors are facing hefty losses for March. The Dow is looking at a 4.7% decline, while the S&P 500 is set for a 4% fall and the Nasdaq is on course to decline by 4.5%.

Read: The Dow and S&P 500 have already doubled the number of 1% moves seen in all of 2017

What’s driving markets?

The wreck in tech stocks was weighing on the broader market because the technology sector, notably shares of Facebook Inc . /zigman2/quotes/205064656/composite FB +1.35% , Amazon.com Inc . /zigman2/quotes/210331248/composite AMZN -0.54% , Apple Inc . /zigman2/quotes/202934861/composite AAPL -0.48% , Netflix Inc . /zigman2/quotes/202353025/composite NFLX +0.76% and Google-parent Alphabet Inc . /zigman2/quotes/202490156/composite GOOGL +0.22%  , /zigman2/quotes/205453964/composite GOOG +0.10%  commonly known by the acronym FAANG, have powered the lion’s share of the market’s advance.

Concerns are piling up for big tech companies. Tesla Inc . /zigman2/quotes/203558040/composite TSLA +0.73% faces an investigation of a fatal crash of one of the company’s electric cars in California last week, with its shares off 8.1%. Nvidia Corp . /zigman2/quotes/200467500/composite NVDA +2.73%  is halting tests of self-driving cars over the recent death of a pedestrian hit by an Uber Technologies Inc. vehicle. Shares Nvidia fell 1.9$%.

Meanwhile, Facebook said it would streamline privacy settings, which helped to provide a modest lift to a the company’s persistent slump. Facebook is contending with backlash over how it managed user data, which was obtained by Cambridge Analytica.

Three people plan to sue the social-networking company over alleged privacy violations. Its shares took a hit Tuesday over reports CEO Mark Zuckerberg would face a Congress grilling over handling of user data, while news of a probe by the Federal Trade Commission also took a toll.

Read: Tech stocks face a ‘dumpster fire’—but here’s how that could be bullish

Investors were also looking at the geopolitical front, where China confirmed a visit from North Korean leader Kim Jong Un, and reportedly told Chinese President Xi Jinping that the country was committed to denuclearizing the Korean Peninsula.

That prompted a tweet from President Donald Trump who said he got a message from Xi that the meeting went “very well.”

Investors have spent part of March fretting about trade sanctions the U.S. was planning to impose on other countries, but worries on that front have calmed in recent sessions.

Treasury yields remained in focus, with the yield on the 10-year Treasury note /zigman2/quotes/211347051/realtime BX:TMUBMUSD10Y -1.74% holding at its lowest level in about seven weeks, on worries about President Donald Trump’s trade policies, among other worries.

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add Add to watchlist BX:TMUBMUSD10Y
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