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NEW YORK: The tech-heavy Nasdaq led Wall Street lower on Tuesday with a 3% slump, as nerves ahead of earnings from megacap growth and technology companies added to concerns over slowing global growth and a more aggressive Federal Reserve.

Market-leading growth stocks have been hammered this year as investors fret over the impact of higher interest rates on their future earnings, while China’s COVID-19 led lockdown and hawkish pivot by major central banks have overshadowed what has been a better-than-expected earnings season so far.

Growth-oriented sectors such as technology, communication services and consumer discretionary tumbled between 2.8% and 4.1%, the biggest losers among the 11 major S&P 500 sectors.

Alphabet Inc and Microsoft Corp slid 3.4% and 2.9%, respectively, ahead of their results after the closing bell on Tuesday. About a third of the S&P 500 companies are set to report results this week.

“If the earnings and forecasts are bad, we could be in for much bigger pain. The earnings of those big ones are going to set the tone,” said Joe Saluzzi, co-manager of trading at Themis Trading in Chatham, New Jersey.

“In addition to war concerns, you have COVID concerns which could affect the supply chain. China is such a major supplier, particularly to some of these tech companies. That could be a big problem, so investors are watching that one carefully.” The United States and allies pledged new packages of ever heavier weapons for Ukraine during a meeting on Tuesday, brushing off a threat from Moscow that their support for Kyiv could lead to nuclear war.

The S&P 500 energy sector rose 2.1% as oil prices rebounded following reports that Russian gas supplies to Poland were halted.

At 11:36 a.m. ET, the Dow Jones Industrial Average was down 530.97 points, or 1.56%, at 33,518.49, the S&P 500 was down 81.69 points, or 1.90%, at 4,214.43, and the Nasdaq Composite was down 394.64 points, or 3.03%, at 12,610.21.

Twitter fell 3%, a day after the social media platform agreed to sell itself to Tesla Inc chief Elon Musk, while Tesla dropped 9.5% .

Of the 134 companies in the S&P 500 that reported earnings so far, 80.6% topped analysts’ profit expectations, according to Refinitiv data. In a typical quarter, 66% beat estimates.

General Electric Co fell 11.6% after forecasting full-year earnings at the low end of its previous estimate.

United Parcel Service Inc slipped 3.9% despite reporting a rise in quarterly adjusted profit, while US hospital operator Universal Health Services Inc slumped 9.1% after its earnings missed estimates.

Meanwhile, data showed US consumer confidence edged lower in April, though households planned to buy automobiles and many appliances, which should help underpin consumer spending in the second quarter.

Declining issues outnumbered advancers for a 3.01-to-1 ratio on the NYSE and a 4.08-to-1 ratio on the Nasdaq.

The S&P index recorded no new 52-week highs and 34 new lows, while the Nasdaq recorded 18 new highs and 464 new lows.

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