NEW YORK (TheStreet) -- The Nasdaq tumbled below 5,000 on Tuesday as investors sold high-momentum biotech and technology stocks while the other benchmark indexes fell as Wall Street digested U.S. services activity data and a wider-than-expected trade deficit.
The S&P 500 was down 0.79%, the Dow Jones Industrial Average declined 0.54%, and the Nasdaq slipped 1.3%.
Biotech stocks including Gilead Sciences (GILD), Alexion Pharmaceuticals (ALXN), and Amgen (AMGN) were all lower, while the Health Care SPDR ETF (XLV) slid 1.2%. Apple (AAPL), Baidu (BIDU), Intel (INTC) and Google (GOOGL) dropped and the Technology SPDR ETF (XLK) fell 1.2%.
The U.S. trade deficit jumped to $51.4 billion in March, hitting a six-year high and far wider than an estimated $41.7 billion. Imports increased after the nine-month slowdown at West Coast ports caused a backlog of cargo that is now being cleared.
"We had a bad trade number this morning, (indicating) first quarter GDP actually negative," David Kelly, chief global strategist at JPMorgan Funds, told CNBC. "That might be part of the story."
The ISM services index climbed to 57.8 in April from 56.5 in March. Economists had expected the reading to remain unchanged month to month. The employment index increased to 56.7 from 56.6, a promising sign ahead of Friday's U.S. jobs report.