Rising Rates Rock Stocks

Stocks plunged Tuesday after long-term interest rates hit their highest level in a year on inflation concerns.

Rising inflation in China and lukewarm interest in the weekly U.S. Treasury auction were among the reasons given for the latest debacle in the bond market, where long-term interest rates have risen from 4.5% to 5.25% since March.

Mixed guidance from Texas Instruments sent its shares 2% lower and weighed on the rest of the tech sector.

Intel gained on reports that it may cut prices.

Apple escaped unscathed on news that it will make its Mac browser available on Windows.

Diodes gained after raising its sales guidance.

Aspen Tech fell on plans to restate three years worth of results.

Netflix fell on another downgrade, this time from Citigroup, on growing competition from Blockbuster.

The Nasdaq lost 22 to 2549, the S&P 500 fell 16 to 1493, and the Dow tumbled 129 to 13,295. Volume rose to 3.03 billion shares on the NYSE, and 2.01 billion on the Nasdaq. Declining issues led by 28-4 margin on the NYSE, and by a 22-7 margin on the Nasdaq. Downside volume was 87% on the NYSE, and 75% on the Nasdaq. New highs-new lows were 57-143 on the NYSE, and 86-105 on the Nasdaq.