Tech giants drag Wall Street lower
US stocks fell on Friday, led by technology-related megacaps that have propelled this year's rally, while investors weighed the interest rate outlook ahead of next week's Federal Reserve meeting. Traders have reined in bets of a June rate cut by the Fed after this week's hotter-than-expected inflation data. Shares of Adobe dropped 13.7 percent, a day after it forecast second-quarter revenue below analysts' estimates, citing competition and weak demand for its artificial intelligence-integrated photography, illustration and video. Microsoft fell 2.1 percent. "We seem in a period here where everyone knows rates eventually will be lowered. The expectation of when it happens keeps getting slightly pushed back, but investors still believe it will happen," said Rick Meckler, partner at Cherry Lane Investments in New Vernon, New Jersey. "It's been a back-and-forth market as people reposition and consider whether some of the real winners have just gone a little bit too far, so you're seeing them trade off." The Dow Jones Industrial Average fell 0.49 percent, to 38,715. The S&P 500 lost 0.65 percent, at 5,117 and the Nasdaq Composite dropped 0.96 percent, to 15,973. Major indexes registered slight declines for the week. The Dow was down 0.02 percent, the S&P 500 was down 0.1 percent and the Nasdaq was down 0.7 percent. Among data released on Friday, production at US factories increased more than expected in February, but the January figure was revised sharply down as manufacturing remains hamstrung by higher interest rates. Also, the University of Michigan's preliminary reading on the overall index of consumer sentiment came in at 76.5 this month, versus an estimated reading of 76.9. All eyes are now on next week's Fed meeting and any clues on the central bank's outlook for rate cuts. Among other declining shares, Ulta Beauty fell 5.2 percent after forecasting full-year profit below Wall Street estimates, as elevated supply-chain costs and increased promotions hurt its margins. (Reuters)