Snapchat earnings, tech stocks weigh on stock market with S&P 500 down more than 2%

Stocks fell in morning trading on Wall Street Tuesday, weighed down by a big decline in tech heavyweights over concerns about persistently rising inflation’s impact to their bottom lines.

The S&P 500 index fell 2.1% as of 10:14 a.m. Eastern. The Dow Jones Industrial Average fell 351 points, or 1.1%, to 31,524 and the Nasdaq fell 3.6%. A stark profit warning from Snapchat’s parent company spooked investors into dumping the stocks of major social media companies. Snap plummeted 39%, while Facebook’s parent, Meta, slumped 10%. Google’s parent fell 8%. Technology and communications stocks, with their lofty values, tend to have an outsize influence on the market.

The sectors have been responsible for much of the volatility the market has seen recently as well as a broad decline the market’s major indexes have seen since early April as investors worry about the impact of rising inflation on businesses and consumers. Retailers and companies that rely on direct consumer spending also fell sharply. Amazon shed 4.3% and Target fell 3.9%.

Bond yields fell. The yield on the 10-year Treasury fell to 2.75% from 2.86% late Monday. Falling bond yields weighed on banks, which rely on higher yields to charge more lucrative interest on loans. Citigroup fell 1.9%. Household goods companies and utilities, which are considered less risky than other sectors, made gains.