S&P 500 falls as tech stocks fall following Fed decision

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S&P 500 falls as tech stocks fall following Fed decision

Wall Street's main index fell on Friday as big technology-related shares fell, reeling from the Federal Reserve's decision to end its pandemic-era stimulus.

Three quarter-percentage-point interest rate hikes by the end of 2022 to combat rising inflation put pressure on heavyweight tech stocks, according to an announcement from the Fed this week.

Growth stocks including Apple, Meta Platforms, Amazon.com Inc. and Microsoft Corp. fell between 0.5% and 1.2%.

Nine of the 11 major S&P 500 sector indexes fell in early trading, with a 0.9% decline in technology stocks weighing the most on the benchmark index.

Financials and energy, which bounced back after the Fed's announcement, fell more than 2% each.

Thomas Hayes, managing member at Great Hill Capital LLC in New York, said it was an explicitly hawkish Fed meeting on Wednesday.

A lot of people that came in high cash positions and hedged against tech in case the Fed was more hawkish than expected, breathed a sigh of relief in the short term or covered their shorts. The S&P 500 tracked declines of nearly 2%, while the Nasdaq index was set to end the week 3.6% lower.

In 2021, most heavyweight growth stocks have outperformed the broader market, with the Philadelphia SE Semiconductor index adding nearly 35%. The benchmark S&P 500 index gained 23% in the same period.

Global trading sentiment was retreated on Friday due to concerns about the fast-spreading Omicron variant of the coronavirus, which has impacted global trading sentiment since November.

The Dow Jones Industrial Average was down 508.31 points, or 1.42%, at 35,389. The S&P 500 was down 48.97 points, or 1.05%, at 4,619. The Nasdaq Composite had a loss of 117.80 points, or 0.78%, at 15,062. The triple witching of stock options, stock index futures and index options contracts is expected to cause volatility throughout the trading session, because of the simultaneous expiration of stock options, stock index futures and index options contracts later in the day.

Oracle fell 5.2% after a report said the enterprise software maker is in talks to buy Cerner in a deal that could be valued at $30 billion. Cerner's shares went up 12.9%.

FedEx Corp went up 7.3% after the delivery firm restored its original fiscal 2022 forecast on Thursday, even as persistent labor woes chipped away profits. Shares of the United Parcel Service also increased by 0.9%.

Declining issues outnumbered advancers for a 3.62 to 1 ratio on the NYSE and a 2.71 to 1 ratio on the Nasdaq.

The S&P index recorded 16 new 52 week highs and five new lows, while the Nasdaq recorded five new highs and 266 new lows.