Tech Stocks Tumble: Wall Street's Rocky Morning

U.S. stock indexes began lower as technology stocks continued their decline amidst Fed officials' hawkish remarks on interest rate cuts. Applied Materials shares dropped due to reduced China spending forecasts. Meanwhile, Cidara soared following Merck's acquisition news. Investor sentiment remains cautious amid economic data gaps post-government shutdown.

Amid a challenging morning for Wall Street, technology stocks spearheaded a sharp decline, influenced by fresh hawkish remarks from Federal Reserve officials regarding the prospects of interest rate cuts. Thursday saw the three major U.S. indexes suffer their steepest losses in over a month, with heavyweight tech stocks driving the downturn.

Investor sentiment has been dampened by concerns over inflated AI stock valuations, prompting multiple selloffs that have left the Nasdaq poised for a second week of consecutive losses. Applied Materials marked a significant downturn, plummeting 7.4% premarket following forecasts of decreased spending in China stemming from tighter U.S. export controls.

Adding to the market's turbulence, Cidara Therapeutics' value soared after news of Merck's $9.2 billion acquisition. As the Dow, S&P 500, and Nasdaq futures continued their descent, the market's fright index, the CBOE volatility index, peaked. Moreover, recent gaps in economic data due to a historic government shutdown have exacerbated market uncertainties.

(With inputs from agencies.)