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Dow Falls 600 Points As Tech Rout Hits Stocks (#GotBitcoin?)

Decline erases a rally in energy shares, which had bounced higher with oil prices; Dow industrials fall 600 points.

The Dow Jones Industrial Average tumbled about 600 points Monday as anxiety over the health of technology behemoths sparked a broad retreat from the stock market.

Monday’s selling began in the technology sector, then morphed into a broad rout that dragged lower everything from oil conglomerates to manufacturers to entertainment firms. It was the latest setback for the stock market, which has struggled to break out to new highs since the S&P 500 capped off its worst month in more than seven years.

The Dow industrials fell 602 points, or 2.3%, to 25387. The S&P 500 lost 2% and the Nasdaq Composite dropped 2.8%.

Some pinned the retreat to worries that risky assets as a whole look increasingly vulnerable to a reversal following a yearslong rally.

Others said flaring tensions in Italy and the U.K. were contributing to the general unease in the markets. And still others blamed nervousness around the future of chip makers and consumer device companies that had driven much of the bull market’s gains earlier in the year.

Apple fell 4.7% after one of its suppliers, Lumentum, cut its earnings and revenue outlook—triggering fresh worries about demand for the company’s iPhone line. The fall of companies like Apple, among others, has often preceded broader pullbacks this year as investors have questioned what sectors can ride higher as the global economy shows more signs of slowing.

“People tend to ask what’s Amazon doing today? What’s Apple doing today?” said Robert Pavlik, senior portfolio manager and chief investment strategist at SlateStone Wealth. And when those technology giants, among others, falter, investors tend to become increasingly nervous about how far the broader market can rise, Mr. Pavlik added.

Growth Worries

Apple shares tumbled after one of its suppliers, Lumentum Holdings, cut it’s earnings and revenue outlook, adding to worries about demand for iPhones.

Among the biggest decliners in the Dow industrials: Goldman Sachs. Shares tumbled 7.1%, wiping out more than 100 points from the blue-chip index of 30 stocks, as concerns grew over the bank’s interaction with a financier charged with stealing billions of dollars from the 1Malaysia Development Bhd. investment fund.

General Electric also took a hit, dropping 7% and heading for its fourth consecutive daily decline after comments from the firm’s chief executive on CNBC failed to assuage investors’ worries about the future of the industrial conglomerate.

As stocks slumped, investors flocked to shares of dividend-paying sectors that tend to perform well during periods of heightened volatility. The utilities and real-estate sectors rose 0.8% and 0.4% apiece, the only two groups in the S&P 500 to post gains so far in the day.

The drops across the stock market erased a brief rally in energy shares, which had bounced higher with oil prices earlier after Saudi Arabia said it would slash exports and the Organization of the Petroleum Exporting Countries considered a collective production cut.

U.S. crude oil for December delivery fell 0.4% to $59.93 a barrel, wiping out its gains for the day and notching its 11th consecutive daily decline—its longest such streak on record, according to Dow Jones Market Data analysis going back to 1983. Signs of a coming oil glut and falling crude prices have pushed suppliers nearer to a pact to reduce output.

“The size of any production cuts will likely depend on how much oil demand growth will slow down into 2019, how much Iranian supply falls due to U.S. sanctions and how strongly U.S. supply increases over the coming months,” said Giovanni Staunovo, a commodities analyst at UBS Wealth Management, noting that OPEC only makes decisions at certain meetings, the next of which is scheduled for the beginning of December.

Elsewhere, the Stoxx Europe 600 fell 1%, while the U.K.’s FTSE 100 lost 0.7%.

The euro and pound both fell against the U.S. dollar, dragged by heightened uncertainty in the U.K.’s negotiations over Brexit. Party infighting among U.K. Prime Minister Theresa May’s Conservatives and unsolved questions on Northern Ireland were among the factors weighing down sterling on Monday, analysts said.

In Asia, Japan’s Nikkei Stock Average closed 0.1% higher, while Hong Kong’s Hang Seng gained 0.1%.

Fears about slowing growth in China and trade tensions weighing on consumption were assuaged by Alibaba Group Holding’s Singles Day on Sunday, when Chinese consumers bought $30.8 billion worth of goods in 24 hours, surpassing last year’s $25.3 billion.

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