By Yasin Ebrahim
Investing.com –The S&P 500 fell Wednesday as signs the Federal Reserve is starting to think about broaching the bond tapering topic at upcoming meetings offset relative rebound in tech amid dip buying in chip stocks.
The S&P 500 fell 0.81%, the Dow Jones Industrial Average fell 0.49%, or 341 points, and the Nasdaq Composite slipped 0.49%.
The Federal Reserve minutes from its April meeting due at 2PM ET, served up the first signs that some central bank members are ready to start thinking about tapering.
"A number of participants suggested that if the economy continued to make rapid progress toward the Committee's goals, it might be appropriate at some point in upcoming meetings to begin discussing a plan for adjusting the pace of asset purchase," the minutes showed.
Tech was flat after recovering from a more than 1% drop intraday as battered chip stocks attracted dip-buying helping to steady the overall sector.
The iShares PHLX Semiconductor ETF (NASDAQ:SOXX) was up more than 1%, led by Marvell Technology (NASDAQ:MRVL), II-VI (NASDAQ:IIVI) and Analog Devices (NASDAQ:ADI) leading the charge.
Analog Devices climbed more than 4% after reporting first-quarter results that topped analysts' estimates.
Mega-cap tech, meanwhile, also pared the bulk of their losses.
Apple (NASDAQ:AAPL), Facebook (NASDAQ:FB), and Microsoft (NASDAQ:MSFT), Google-parent Alphabet (NASDAQ:GOOGL) and Amazon.com (NASDAQ:AMZN) were well off their intraday lows.
The dip-buying in tech, however, appears to come at the expense of the economically-sensitive cyclicals corners of the market like energy, financials and materials.
Energy was among biggest losers on the day as oil prices fell more than 2% despite data showing a smaller-than-expected build in weekly U.S. crude stocks.
Crude oil stockpiles rose by 1.3 million barrels for the week to May 14, a lower build than the 1.6 million barrels economists had forecast.
On the earnings front, Take-Two Interactive Software (NASDAQ:TTWO) reported fiscal fourth-quarter results that topped Wall Street estimates, sending its share price up more than 5%.
Target (NYSE:TGT) was also up more than 5% after its first-quarter results beat on both the top and bottom lines.
In the midst of the selloff in crypto that has since abated - sparked by a regulatory crackdown on Bitcoin in China and broader risk-off sentiment in crypto markets during recent days - stocks including Tesla (NASDAQ:TSLA), Square and MicroStrategy were under pressure.