Investors dumping tech stocks pushes Nasdaq into correction territory

Michael Nagle | Bloomberg | Getty Images

Traders work on the floor of the New York Stock Exchange (NYSE) in New York, U.S., on Wednesday, Nov. 9, 2016.

Investors are dumping their favorite tech stocks and pushing the Nasdaq into correction territory Tuesday.

The Nasdaq Composite tanked as much as 2.8 percent in morning trading before paring some losses. At its lowest point Tuesday, the index was 10.7 percent below its all-time intraday high of $8,133.30, hit on Aug. 30.

Major tech companies accounted for nine of the top 10 stocks weighing negatively on the Nasdaq — yielding only for Pepsi to slip in among the biggest losers.

By 11 a.m. in New York, Apple and Facebook had each dropped 2 percent, Amazon and Microsoft had each dropped 3.5 percent, and Google parent Alphabet had dropped 2.2 percent.

Jeremy Klein, chief market strategist at FBN Securities, noted the tech sector’s been out of favor for several weeks, as managers take profits ahead of year’s end and brace for another tech earnings season.

Amazon, Intel, Alphabet, Twitter and Snap all report quarterly earnings later this week, followed by Facebook and Apple next week. Last quarter saw major market moves for tech companies, as quarterly results pretty consistently disappointed.

But compared with industrials — getting dragged lower Tuesday by Caterpillar and 3M earnings — Klein said, the tech stocks aren’t the problem.

“[There’s] carnage pretty much everywhere,” Klein said. “I think tech is just caught up in it today.”