Tough Day for Tech as NASDAQ Slips 1%+

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Congressional testimonies from a couple tech bigwigs gave investors enough reason to pull profits from the space on Wednesday, handing the NASDAQ its worst session in weeks.

Facebook COO Sheryl Sandberg and Twitter CEO Jack Dorsey were in Washington today and getting grilled by lawmakers on election tampering, privacy issues and bias, among other topics. The market's real fear, though, is the threat of increased regulation for some of the biggest engines of this strong economy.

But it wasn't just social media names taking it on the chin. Technology in general was being sold, leading to a 1.19% plunge in the NASDAQ to 7995.2. There's not much this index can do when all of the FANGs pull back at once. The last time the NASDAQ slipped by more than 1% was during the Turkey mess back in mid-August.

Tech also has a big stake in the S&P, but that index managed to slide by only 0.28% to 2888.6. The Dow bounced around more than its counterparts and actually finished with a gain of 0.09% to 25,975.

While these testimonies were the big news today, the market is still keeping a close eye on trade. The U.S. and Canada got back to negotiations today after failing to work out a deal last week. President Trump and Canadian Prime Minister Justin Trudeau are taking hard lines on the issue with both pretty much saying that no agreement is better than a bad agreement.

And of course, there's still $200 billion worth of new tariffs that could be imposed on Chinese goods this week.

Today's Portfolio Highlights:

Stocks Under $10:
The market was not happy with early results for a gene-editing trial from Sangamo BioSciences (SGMO). As a result, shares got shellacked on Wednesday and dropped more than 23%. SGMO was one of the best performers in the portfolio and Brian Bolan wanted to hold onto the name until it reached about $25. But biotech can be extremely volatile, and the editor doesn't want to risk any more of this impressive profit. He sold SGMO today and banked an approximately 55% return.

Home Run Investor: When you're heavily invested in tech, a day like this has you looking for a little diversification. Brian Bolan doesn't think today's tech selloff is a big deal, but it's just a good reminder that balance is key. Therefore, he picked up an industrial play on Wednesday by adding Harsco (HSC), which is a Zacks Rank #2 (Buy) services and engineered products company. In addition to some good style scores, the editor really appreciates that HSC has beaten earnings estimates for 13 quarters in a row! Read the complete commentary for more on this new addition.

Counterstrike: "Finally, we saw some selling in the big tech names, that brought FANG bulls to their knees.

"Stocks like GOOGL and NFLX were very weak, giving back their recent gains. Amazon and Apple showed their first signs of weakness in over a week. With that recent semiconductor winners AMD and NVDA both saw reversals in the morning.

"While selling was aggressive in the morning, we saw the typical rebound in the afternoon. We keep seeing China selling off, which is causing selling in Asia and trickling to Europe. When the market opens here, the futures are already down, causing traders to buy the dip. So far the S&P continues to hold up well."
-- Jeremy Mullin

All the Best,
Jim Giaquinto

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Zacks Investment Research

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

This article appears in: Investing , Stocks
Referenced Symbols: SGMO , HSC

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