Marvell Falls 13% and Oracle 8.6% as Selling in U.S. Tech Stocks Intensifies

Key Facts

U.S. stocks fell in the Monday, November 2 session after a morning rally faded and selling pressure returned to technology shares in the afternoon, according to Reuters. Oracle shares fell 8.6%, while Marvell dropped 13% after announcing a $115 billion acquisition agreement. The report cited investor concern about the foundations of the rally in artificial intelligence stocks. The market moves came after the Federal Reserve’s October 28 decision to keep its target interest-rate range at 3.75%–4.00%. That decision was issued after the committee meeting held on October 27–28, not on November 3.

Ten members voted to hold interest rates steady, while two supported a quarter-point increase, according to a Reuters report. The dissenting members were Federal Reserve Governor Lisa Cook and Cleveland Fed President Beth Hammack. The report said both favored raising interest rates by a quarter point. In its October 28 statement, the central bank described the pace of economic activity growth as strong and said inflation “remains elevated.” It also said household spending had remained resilient and capital investment solid, while uncertainty remained elevated in part because of geopolitical developments.

The Federal Open Market Committee said that gathering more information would help it determine the appropriate monetary policy stance to return inflation to its 2% target in a timely manner. Reuters said the Fed’s assessment of the economy had improved compared with its September meeting, with its description of expansion shifting from “solid” to “strong.” The agency reported that job gains were keeping pace with labor-force growth, while investment continued to be described as solid. In the October 28 decision session, the S&P 500 and Nasdaq Composite each rose 0.3%, while the Dow Jones gained 0.2%, according to the Associated Press. After the announcement, the two-year Treasury yield rose 3.9 basis points to 4.776%, and the 10-year yield increased 5 basis points to 5.047%, according to Reuters via Investing.com.

In its labor-market data schedule, the Federal Reserve Bank of St. Louis calendar listed the weekly jobless claims report for Thursday, November 5. On the outlook for monetary policy, a Reuters report quoted Goldman Sachs Asset Management’s global head of research as expecting rate hikes to resume in December. She said the strong September consumer price index reading was a reminder that upside inflation risks remained. She added that higher energy prices or further strong data could open the door to additional tightening in the following year. These remarks remain forecasts attributed to her, while the Fed said more information would support its determination of the monetary policy stance.