U.S. stocks dropped, capping their biggest weekly rout since March, after earnings from the largest tech companies disappointed investors concerned that a slowing economy will damp profit.

The Nasdaq 100 declined about 2.6 per cent after Apple Inc.’s iPhone sales and Twitter Inc.’s user growth both missed estimates, though Google parent Alphabet Inc. jumped after reporting a rebound in advertising. The S&P 500 Index dropped 5.6 per cent over the past five days, the worst-ever loss in the week leading to a presidential election. Ten-year Treasury yields jumped to the highest since June.

The tech slump, coming after an unprecedented run higher this year, is adding to volatility that’s likely to remain elevated heading into next week’s U.S. election. Global equities posted the worst weekly decline since March as lockdown measures in some countries and the lack of an agreement on U.S. stimulus dented sentiment. New U.S. coronavirus cases topped 89,000, setting a daily record.

"Today’s action is a reminder of just how fickle markets can be,” said Yousef Abbasi, global market strategist at StoneX. “The earnings themselves were not awful, but the market has priced tech to near perfection and thus one fly -- maybe even a fruit fly -- in the ointment could perpetuate a sell-off.”

In Europe, equities edged higher. Tech stocks also faltered as did Danish drug giant Novo Nordisk A/S, whose earnings disappointed analysts. Banks rose after Spain’s BBVA SA and the U.K.’s NatWest Group Plc reported improved pictures for soured loans.

Elsewhere, spot gold prices rose. Crude oil slumped in New York.

Here are the main market moves:

Stocks

  • The S&P 500 Index decreased 1.2 per cent as of 4 p.m. New York time.
  • The Nasdaq 100 Index dropped 2.6 per cent.
  • The Stoxx Europe 600 Index rose 0.2 per cent.
  • The MSCI Asia Pacific Index sank 1.7 per cent.

Currencies

  • The Bloomberg Dollar Spot Index rose less than 0.1 per cent.
  • The British pound increased 0.2 per cent to US$1.2954.
  • The Japanese yen fell 0.1 per cent to 104.68 per dollar.

Bonds

  • The yield on 10-year Treasuries rose four basis points to 0.87 per cent.
  • Germany’s 10-year yield climbed one basis point to -0.63 per cent.
  • Britain’s 10-year yield increased four basis points to 0.26 per cent.

Commodities

  • West Texas Intermediate crude fell 1.6 per cent to US$35.60 a barrel.
  • Gold strengthened 0.6 per cent to US$1,878.61 an ounce.

--With assistance from Joanna Ossinger, Adam Haigh, Yakob Peterseil, Todd White and Robert Brand.