US equities fell dramatically after Apple announced plans to restrict hiring, adding to market concerns that the Federal Reserve's anti-inflation drive may send the country into a recession.
The S&P 500 extended losses in the final hour of trade after posting a gain of more than 1%. Tech and health-care stocks led the decline, with Apple losing more than 2% on its worst day in over three weeks. According to people familiar with the situation, the iPhone maker intends to halt hiring and spending growth in several divisions next year in order to prepare for a future economic slump. The announcement came on the heels of a similar move by Google last week.
On Tuesday evening, Netflix will kick off second-quarter earnings for major technology and communication businesses. Profit growth in the industry is projected to drop dramatically. Earlier, Goldman Sachs posted better-than-expected earnings, driving its stock up.
Stocks have been recovering from their June lows on anticipation that the Fed is making progress in its attempts to curb price increases. Treasuries fell on Monday, with 10-year yields falling below 3% – still lower than the 2-Yr yield – leaving the yield curve inverted, signalling a recession.