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Wall Street stocks fell on a broad-based slump in technology stocks and a tumble in consumer staples on Thursday, while oil prices softened and other commodities went on a wild ride.

Rising U.S. Treasury yields widened the curve slightly after nine days of flattening, and supported a stronger dollar.

Strong corporate earnings had boosted stocks this week, but a tepid forecast on smartphone demand sent stocks from Apple to chipmakers tumbling on Thursday.

Tobacco company Philip Morris plunged 15.6 per cent after announcing weak results and forecasts, dragging down the S&P 500 index and rival Altria.

Oil prices softened after having spiked to highs not seen since 2014.

“I do think we could see $70 pretty quick, but I want to caution that maybe we’ll see the market level out a little bit in a few weeks,” said Phil Flynn, analyst at Price Futures Group in Chicago.

U.S. crude fell 0.35 per cent to $68.23 per barrel and Brent was last at $73.71, up 0.31 percent.

Nickel and aluminum soared to multi-year highs, buoyed by talk that Saudi Arabia had its sights set on $80 to $100 a barrel oil and of more U.S. sanctions on Russian aluminum producers, including Rusan.

Nickel initially jumped by the most in 6-1/2 years and aluminum prices reached their highest since 2011.

But the metals later turned sharply negative, with analysts saying the gains were overdone.

“It has been a very erratic day, it’s a bit crazy,” said Rabobank metals sector economist Casper Burgering. “Nickel went up by almost 10 per cent and aluminum by almost 8 per cent and now are coming right back down.” Expect more volatility, he said.

The Thomson Reuters CoreCommodity total return index opened on Thursday near its highest since mid-2015, before giving back all its gains.

Canada’s main stock index fell on Thursday, pulling back from a four-week high the day before, as shares of consumer cyclical and materials companies led broad-based declines.

The Toronto Stock Exchange’s S&P/TSX composite index unofficially closed down 75.55 points, or 0.49 per cent, at 15,454.42. Nine of the index’s 10 main groups ended lower.

Material stocks fell 0.5 per cent on Thursday. Alamos Gold Inc. finished down 2.6 per cent, while Agnico Eagle Mines Ltd. dropped 2.1 per cent.

Consumer discretionary stocks fell 0.7 per cent, including a 3.3-per-cent drop by Corus Entertainment Inc. and 2.1-per-cent fall by Magna International Inc.

Consumer staples fell 0.5 per cent, led by a 2.6-per-cent decline from Maple Leaf Foods.

The heavyweight financial sector was 0.3 per cent lower. Toronto-Dominion Bank declined 0.7 per cent, while Bank of Nova Scotia fell 0.5 per cent.

Only the energy sector, which accounts for nearly a fifth of the index’s weight, advanced on the day, finishing up 0.2 per cent. It was helped by a 1.1-per-cent rise in shares of Canadian Natural Resources Ltd. Crescent Point Energy Corp. rose 2.3 per cent, while Seven Generations Energy Ltd. was up just over 2 per cent.

In New York, the Dow Jones Industrial Average fell 83.4 points, or 0.34 per cent, to 24,664.67, the S&P 500 lost 15.51 points, or 0.57 per cent, to 2,693.13 and the Nasdaq Composite dropped 57.18 points, or 0.78 per cent, to 7,238.06.

A warning from Taiwan Semiconductor (TSMC), the world’s largest contract chipmaker and an Apple Inc supplier, on soft demand for smartphones and on the industry’s growth this year sparked a tumble in chip stocks and made Apple the S&P’s second biggest weight.

Along with weak results from Philip Morris and Procter & Gamble, defensive sectors such as consumer staples were also hurt by a rise in U.S. 10-year Treasury yields, which helped bank stocks.

“It’s an obsession with high interest rates right now,” said Richard Sichel, senior investment strategist at The Philadelphia Trust Company. “The sectors really tell the story. Financials are up because they do better in a higher rate environment.”

When yields are high, investors favor bonds over defensive sectors such as consumer staples and real estate, which promise high dividends and slow growth. But banks benefit as high interest rates can boost their profits.

Apple shares fell 2.8 per cent, with analysts telling Reuters that TSMC’s warning was related to the iPhone maker. It was the biggest drag on the Dow Jones Industrial Average and the Nasdaq.

TSMC’s U.S.-listed shares fell 5.7 per cent, while the Philadelphia SE semiconductor index tumbled 4.2 per cent.

The pan-European FTSEurofirst 300 index rose 0.02 per cent and MSCI’s gauge of stocks across the globe shed 0.47 per cent.

The bullish sentiment in markets comes amid wider optimism about economic growth. The global economy is expected to expand this year at its fastest pace since 2010, the latest Reuters polls of over 500 economists worldwide suggest, but trade protectionism could quickly slow it down.

Investors were also relieved that no new U.S. demands on trade came out of a summit between Japanese Prime Minister Shinzo Abe and U.S. President Donald Trump.

Benchmark 10-year U.S. Treasury notes last fell 14/32 in price to yield 2.9173 per cent, its highest since Feb. 21.

The 30-year bond fell 1-7/32 in price to yield 3.1097 per cent, from 3.046 per cent late on Wednesday.

The U.S. dollar rose 0.3 per cent against a basket of major currencies as the higher yields and expectations of more Federal Reserve rate increases offset concerns about a trade war and a ballooning U.S. budget deficit.

Reuters

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