US STOCKS-Wall Street indexes fall 1%, dragged by tech and Iran war worries

Broadcom

Wed 21:00

May consumer prices data largely in line with estimates
Super Micro Computer dips after plan to raise $7 billion 
Trucking shares down after Amazon launches LTL freight offering
Updates to close
By Caroline Valetkevitch and Joel  Jose

    June 10 (Reuters) - 
    The major U.S. stock indexes ended more than 1% lower on Wednesday, with chipmaker shares extending recent declines and with renewed tensions between the U.S. and Iran adding to investor uncertainty.
President Donald Trump said the U.S. would attack Iran again "very hard" following one of the most significant exchanges of fire overnight since an April ceasefire in the Middle East war.
An index of semiconductors .SOX was sharply lower, with Nvidia NVDA.O and Broadcom AVGO.O among the biggest drags on the S&P 500. Investors have been worried about stretched valuations in the sector.
The Cboe Volatility Index .VIX advanced for a second day. Volatility has picked up in recent days.
Investors were still taking some profits in the tech space, said Tom Hainlin, an investment strategist at U.S. Bank Wealth Management in Minneapolis.
Also, investors are now "pricing in maybe a higher interest rate" after recent economic data and are also worried about the war, he said.
"Perhaps that conflict continues on into the mid to late summer," he said. 
The Federal Reserve is widely expected to hold interest rates at its June policy meeting. Investors are pricing in at least one 25 basis point rate hike by the end of the year. 
According to preliminary data, the S&P 500 .SPX lost 119.00 points, or 1.61%, to end at 7,267.65 points, while the Nasdaq Composite .IXIC lost 505.31 points, or 1.97%, to 25,169.50. The Dow Jones Industrial Average .DJI fell 952.04 points, or 1.87%, to 49,920.07.

        Friday's U.S. jobs report was stronger than expected. On Wednesday, U.S. consumer prices increased 4.2% in the 12 months through May, the largest gain since April 2023, data showed, as the Middle East conflict raised the price of gasoline and other energy products.
The pace of increase was, however, in line with forecasts, as per a Reuters poll of economists.
Among other decliners, Super Micro Computer SMCI.O tumbled after it announced plans to raise $7 billion through a series of equity and equity-linked financing transactions to fund component purchases for its growing AI server demand.
The rotation out of high-flying technology shares has helped other areas of the markets that have lagged this year, including healthcare, real estate and consumer staples. 
The much-hyped $1.75 trillion listing of SpaceX SPCX.O on Friday, targeting a record $75 billion raise, could also pressure U.S. stocks as concerns mount over excessive optimism in the tech sector.
Among other movers, shares of trucking companies XPO XPO.N, J.B. Hunt JBHT.O and Old Dominion ODFL.O also dipped after Amazon AMZN.O announced expansion of its less-than-truckload freight services in the U.S. Industrials .SPLRCI led declines among sectors.

 (Reporting by Caroline Valetkevitch in New York and Joel Jose in Bengaluru; additional reporting by Twesha Dikshit and Sruthi Shankar in Bengaluru; Editing by Shinjini Ganguli and David Gregorio)
 ((mailto: caroline.valetkevitch@thomsonreuters.com))