Market drops amid tech sell-off
Other factors were weakness on the part of Ford and Ukraine jitters.
NEW YORK - The stock market fell sharply Friday, dragged down by disappointing quarterly results from Amazon and Ford. Escalating tensions between the United States and Russia over Ukraine also weighed on the market.
Worried investors sold their risky assets and moved into the traditional safe havens: bonds, gold, and stocks that pay high dividends, like utilities.
The Standard & Poor's 500 fell 15.21 points, or 0.81 percent, to 1,863.40. The Dow Jones industrial average lost 140.19 points, or 0.85 percent, to 16,361.46, and the Nasdaq composite lost 72.78 points, or 1.75 percent, to 4,075.56.
Friday's sell-off was enough to push the Dow, S&P 500, and Nasdaq into the red for the week.
Technology stocks, which have been volatile for the last two months, were again a hotbed of selling.
Amazon.com, the world's largest online store, sank $33.32, or 10 percent, to $303.83. Amazon reported late Thursday an increase in first-quarter profit, but the company also said that spending on investments will likely lead to an operating loss in the second quarter.
The retail giant dragged the rest of the technology sector lower, making it one of the worst-performing sectors in the S&P 500. Netflix fell more than 6 percent, Priceline and Facebook each fell 5 percent, and Twitter lost more than 7 percent.
For a second day, the tensions between Russia and Ukraine weighed on investor sentiment.
Secretary of State John Kerry on Thursday accused Russia of failing to live up to its commitments to ease the crisis in Ukraine, and said Washington may have no choice but to impose additional sanctions. In a separate event, Ukraine's deputy foreign minister said he feared that a Russian invasion was imminent.
Investments thought to be less risky were among the few assets to rise Friday. Bond prices rose, pushing the yield on the 10-year Treasury note down to 2.66 percent from 2.68 percent Thursday. Gold rose $10.20, or 0.8 percent, to $1,300.80 an ounce.
Dividend-rich utility stocks also rose. The Dow Jones utility index, a basket of 15 utility stocks, rose 1 percent to 551.66, its highest level since December 2007.
The U.S. might have put in place the sanctions against Russia and its officials to punish that country, but the measures are starting to have an impact the profits of some U.S. companies as well.
Visa fell $10.47, or 5 percent, to $198.93 after it warned that the U.S. sanctions were causing Russian banks to use other companies to process payments. Russian President Vladimir Putin said the country will create its own payment processing system. MasterCard was also hurt by the news. Its stock fell $3.69, or 5 percent, to $70.66.
Visa's decline accounted for roughly half of the fall in the Dow on Friday.
Ford fell 54 cents, or 3.3 percent, to $15.78 after the company reported earnings that fell short of Wall Street's expectations. Worldwide sales rose 6 percent in the first quarter, but the company reported a sales drop in North America that cut into the company's profit.