Of 11 major sectors in SP 500, all but defensive real estate and utilities stocks closed in red.New York:Wall Street plunged on Thursday after slowing US factory activity on heels of a dire revenue warning from Apple Inc fueled fears of a global economic slowdown.The magnitude of Apple's holiday quarter revenue shortfall sent shockwaves through technology sector, which pulled all three major US stock indexes down more than 2 per cent, with Nasdaq posting a 3 per cent loss.SP Technology companiesslid 5.1 per cent, its biggest one-day percentage drop since August 2011.
The Philadelphia SE Semiconductor index ended session 5.9 per cent lower.Late Wednesday, Apple chief executive Tim Cook wrote in a letter to investors that company had not foreseen extent of China's economic deceleration, which was exacerbated by US-China trade tensions.
The iPhone maker's shares dropped 10.0 per cent.A report from Institute for Supply Management showed U.S.
factory activityin December suffered biggest drop since October 2008, height of financial crisis.
Its PMI reading, while still in expansion territory, hit its lowest level in more than two years."The Chinese slowdown was expected but today's softer-than-expected ISM number took investors by surprise because U.S.
seemed to be only port in storm," said Sam Stovall, chief investment strategist of CFRA Research in New York.
"But now it appears that our economic growth is facing trade related headwinds.""Investors are worried that this is an indication that things could be getting worse from here and Apple is only tip of iceberg," Stovall added.Major automakers reported weak U.S.
new car sales in December, with Ford Motor Co and General Motors Co reporting sales falling by 8.8 per cent and 2.7 per cent, respectively.
Ford shares fell 1.5 per cent, while GM dropped 4.1 per cent.The Dow Jones Industrial Average fell 660.02 points, or 2.83 percent, to 22,686.22, SP 500lost 62.14 points, or 2.48 per cent, to 2,447.89 and Nasdaq Composite dropped 202.43 points, or 3.04 per cent, to 6,463.50.Of 11 major sectors in SP 500, all but defensive real estate and utilities stocks closed in red.Trade-sensitive industrials also weighed on Dow, led by Caterpillar Inc, 3M Coand Boeing Co.Bristol-Myers Squibb Co shares dropped 13.3 per cent after drugmaker announced plans to buy rival Celgene Corp for about $74 billion.
Celgene shares jumped 20.7 per cent on news.Shares of US commercial air carriers slid after Delta Air Linescut its fourth quarter revenue estimate.
The SP 1500 Airlines index sank 5.9 per cent.Yields on 2-year Treasuries dipped below federal funds effective rate for first time since 2008, a move many believe suggests central bank will not be able to continue its monetary tightening policy.
The outlook for higher rates has been considered a headwind to equities in recent months.Declining issues outnumbered advancing ones on NYSE by a 1.39-to-1 ratio; on Nasdaq, a 2.28-to-1 ratio favored decliners.The SP 500 posted no new 52-week highs and 13 new lows; Nasdaq Composite recorded 6 new highs and 48 new lows.Volume on US exchanges was 8.11 billion shares, compared to 9.16 billion average over last 20 trading da