Tech Stocks Dip as Traders Eye Fed's Monetary Policy Decision

Technology stocks dragged down the S&P 500 and Nasdaq on Monday as traders grew cautious ahead of the Federal Reserve's significant monetary policy decision. Semiconductor and other growth stocks saw declines, with Nvidia, Broadcom, and Qualcomm among those affected. Economic optimism remains high amid a pending Fed rate-cut decision.

Technology stocks weighed heavily on the S&P 500 and the Nasdaq on Monday as caution permeated the market ahead of the Federal Reserve's critical monetary policy decision expected later this week. A substantial reduction in borrowing costs is anticipated by most traders.

Rate-sensitive chip stocks notably fell, with Nvidia down 2%, Broadcom dropping 2.2%, and Qualcomm losing 1.5%, leading to a 1.7% decline in the Philadelphia Semiconductor Index. Other growth stocks also experienced losses, including Amazon.com, which dropped 0.70% and Tesla, which fell 1.7%. Apple slid significantly by 3.2% after an analyst lowered demand expectations for the latest iPhone 16 models.

Despite bullish market trends since the year's start based on expectations of easier Federal policy, recent movements indicate worries about a potential faster-than-expected economic cooling. The S&P 500 and Nasdaq had their largest weekly rises in 11 months last Friday, driven by positive economic signals rather than specific rate-cut hopes. Economic data and federal comments due this week will further impact market sentiment.

(With inputs from agencies.)