US close: Heavy losses on the Street as tech sell-off hits both the Dow and Nasdaq

Wall Street recorded some heavy losses across-the-board on Monday, with news of Apple's production cuts and Netflix's afternoon fall to a nine-month low hitting both the Dow Industrials and the tech-heavy Nasdaq.

At the close, the Dow Jones Industrial Average was down 1.56% to 25,017.44, while the S&P 500 had lost 1.66% to close at 2,690.73 and the Nasdaq Composite saw the session out an alarming 3.03% weaker at 7,028.48.

Both Apple and Alphabet entered into bear-market territory throughout the session as tech stocks got hammered, leading to a broader market selloff. The Technology Select Sector of the S&P 500 finished down 3.8%.

Elsewhere, relations between the US and China were in focus again as Donald Trump said on Friday that he may not impose further tariffs on Chinese goods. However, over the weekend, US Vice President Mike Pence said at the Asia Pacific summit that there would be no end to US levies on $250bn of Chinese goods unless China changes its ways.

Joshua Mahony, market analyst at IG, said US-China relations "remain just as icy as ever, despite recent hopes of an impending trade deal between the two sides".

"Unfortunately, there are precious few signs of a shift in tone from either sides, and with issues such as IP theft remaining a topic that seems to have no solution (due to Chinese rejection that it occurs), some issues seem destined to remain a roadblock to future progress," he said.

Rising interest rates were also on investors minds, as New York Fed president John Williams struck a somewhat dovish tone in a speech in New York City on Monday, where he stated the bank's goal was to "keep this expansion going for as long as possible."

In corporate news, Apple closed 3.96%, taking a 400 point bite out of the Dow, on the back of a report that said the tech giant had slashed production orders for all three of its new iPhones following weaker-than-expected demand for the devices.

According to the Wall Street Journal, Apple has had a hard time predicting the number of components and handsets it will need of late following its decision to offer more models.

Netflix slumped 5.45% to its lowest closing price since 14 February and a total of 35.4% since 9 July.

The tech giant's 50-day moving average, considered to be one of the more-reliable short-term trend trackers, crossed below its 200-day moving average to create a "death cross" - a dividing line between longer-term uptrends and downtrends.

Nissan lost 5.85% throughout the day after its chairman Carlos Ghosn was arrested in Japan under suspicion of "significant acts" of financial misconduct.

Resolute Energy rallied 13.81% throughout the day after it agreed to be bought by Cimarex Energy for $1.6bn. Cimarex shares stumbled 0.82%.

Elsewhere, Spectrum Brands crashed 19.04% after the consumer products company's fourth-quarter earnings and sales missed analysts' expectations.

Colfax tumbled 15.23% as it agreed to buy orthopaedic device marker DJO Global Inc from Blackstone for $3.2bn in cash. Blackstone was down 2.03% at the close.

On the data front, sentiment among US housebuilders deteriorated more than expected in November amid growing affordability concerns, according to data released on Monday.

The National Association of Home Builders/Wells Fargo housing market index fell eight points from October to 60, missing expectations for a much smaller drop to 67 but remaining in positive territory.

The component gauging current sales conditions declined seven points to 67, while the component measuring expectations over the next six months dropped 10 points to 65. Meanwhile, the gauge measuring buyer traffic fell eight points to 45.

According to the NAHB, builders have continued to see signs of consumer demand for new homes but customers are taking a pause due to concerns over rising interest rates and home prices.

NAHB chief economist Robert Dietz said: "The decline of builder confidence should be noted by policymakers. Recent statements on economic conditions have lacked commentary on housing, even as housing affordability has hit a 10-year low. Given that housing leads the economy, policymakers need to focus more on residential market conditions."