* Tech stocks fall second day; Apple down more than 3 pct
* French and southern euro zone bonds rally
* Oil rises on signs of U.S. inventory declines
* Dollar flat ahead of FOMC; UK uncertainty weighs on
(Updates quotes, prices, changes dateline, previous LONDON)
By Caroline Valetkevitch
NEW YORK, June 12 A selloff in technology stocks
extended to a second day on Monday, led by losses in Apple
, while oil prices rose on signs of inventory declines
in the United States.
The technology sector rout dragged down all three major U.S.
stock indexes and raised concerns about the market's lofty
The euro and its bonds rallied after pro-European parties
scored in French and Italian elections over the weekend and as
stocks jitters raised fresh questions for the Federal Reserve
ahead of its policy meeting this week.
The Nasdaq was down 0.8 percent after falling
1.8 percent on Friday. Apple was down 3.4 percent, though other
tech heavyweights Alphabet, Facebook and
Microsoft also were down.
At the same time, energy shares, which have had the biggest
declines so far this year, added to Friday's gains. The S&P
energy index was up 0.8 percent.
"You're seeing a rotation. You're seeing people not want to
come out of the market. They're selling what's been a winner,
rotating into what's been a loser because they want to stay in
the market. That's not necessarily a bullish omen because when
markets are at tops, people want to stay fully invested," said
Michael O’Rourke, chief market strategist at JonesTrading in
The S&P technology index was down 1.3 percent on
Monday, but remains up 17 percent for the year to date.
The Apple-led worries had taken a heavy toll on Asian rivals
including Samsung overnight and then hit Europe's
big chipmakers STMicro and Dialog.
An ebbing of the reflation trade that was based on U.S.
President Donald Trump's tax and spending promises, and a run of
negative U.S. economic surprises, have prompted some investors
to review the mix of their portfolios.
The Dow Jones Industrial Average was down 69.22
points, or 0.33 percent, to 21,202.75, the S&P 500 had
lost 8.23 points, or 0.34 percent, to 2,423.54 and the Nasdaq
Composite had dropped 51.39 points, or 0.83 percent, to
The pan-European STOXX 600 was down 1 percent.
Oil gained on signs of inventory declines in the United
States. News that Saudi Arabia will limit volumes of crude to
some Asian buyers in July and deepen cuts to the United States
also boosted prices.
Brent crude futures rose 0.7 percent to $48.50 a
barrel, while U.S. crude futures gained 1 percent to
In the foreign exchange market, Britain’s pound was under
pressure, after falling more than 2 percent following last
week's snap elections that left the Conservatives short of a
ruling majority and cast a cloud of political uncertainty over
the country. Sterling fell 0.55 percent to $1.2650.
May's plans for leaving the EU have not changed, her
spokesman said on Monday, although there were calls from
Scotland to steer a course away from a "hard" Brexit.
At the same time, first round French parliamentary election
results look set to give President Emmanuel Macron a huge
majority to push through pro-business reforms also helped.
The dollar was steady with no major U.S. data releases and
ahead of Wednesday's Fed meeting, at which the central bank is
overwhelmingly expected to increase U.S. interest rates.
The dollar index, which tracks the greenback against
six major currencies, was little changed at 97.248.
Benchmark 10-year Treasuries were last down 2/32
in price to yield 2.205 percent, from a yield of 2.199 percent
late on Friday.
For Reuters Live Markets blog on European and UK stock
markets see reuters://realtime/verb=Open/url=http://emea1.apps.cp.extranet.thomsonreuters.biz/cms/?pageId=livemarkets
(Additional reporting by Devika Krishna Kumar in New York;
Dhara Ranasinghe, Patrick Graham, Marc Jones and Helen Reid in
London; Editing by Catherine Evans and Nick Zieminski)