Global Tech Stocks Short Circuit; Investors Flee Sector Amid Wall Street Rout

U.S. tech stocks, which suffered their biggest single day declines in seven years amid yesterday's Wall Street rout, look poised to extend declines Thursday as global investors dump shares in the sector amid concerns over rising interest rates and the ongoing trade war between Washington and Beijing.

Apple Inc. (AAPL)  led the sector declines yesterday, with a 4.6% slide that pulled the S&P 500 Technology Sector index 4.8% lower, with losses accelerating after a weaker-than-expected 10-year U.S. Treasury auction which drew the highest yield since 2011. Europe's small tech sector was marked 3.4% lower by mid-day trading in Frankfurt. Overall market volatility was also a trigger for the sector's decline, with the CBOE's VIX index (VIX.X) , also known as the 'fear gauge', extending yesterday's sharp 30% increase to reach a six-month high of 24.1 points in overnight trading.

"This time round it may be different; previously the sell-off and bounce back had been led by the FANGS and tech companies," said Helal Miah, investment research analyst at The Share Centre. "With increasing questions about these companies' valuations and all the other overhanging worries in the global economy, it may be a while until we see those all-time highs again."

Tech stocks remained under pressure in pre-market trading following yesterday's moves which pushed online retailing giant Amazon Inc. (AMZN)  6.15% lower and into correction territory and pulled the NYSE's FANG+ index 17.86% lower from its June 20 peak. Amazon was marked another 2% lower in pre-market trading Thursday, indicating an opening bell price of $1,720.20.

Apples shares were marked 1.55% lower, indicating an opening bell price of $213 each, despite cutting a $600 million deal to buy power management technology from Dialog Semiconductor (DLGNF) , a U.K. based chip designer listed in Frankfurt that has been at the heart of the tech giant's European supply chain. Facebook Inc. FB shares were seen 1.4% lower at $149.30 each, a move that would extend the social media group's year-to-date decline past 15%.

Japan's Softbank (SFTBY) plunged more than 8.3% in Japan, well outpacing the 3.89% slide for the Nikkei 225 benchmark, as investors grew increasingly concerned for its exposure to the global tech space and the ambitions of billionaire founder Masayoshi Son's $100 billion Vision Fund. 

Apple's Asian and European supply-chain stocks were hit hard Thursday, as well, with General Interface Solution falling 10% to an 18-month low and Hon Hai Precision Industry, also known as Foxconn, sliding around 5% alongside a similar decline for key chipmaker Taiwan Semiconductor (TSM) . 

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