### Stock Market Plummets as Tech Stocks Lead Decline

The stock market is experiencing a substantial selloff on Thursday, with major indices suffering significant losses. The Dow Jones Industrial Average has decreased by 0.7%, while the S&P 500 has plunged 1.3%. The tech-centric Nasdaq Composite has suffered the biggest loss, declining by 2.1%. The losses worsened as the day progressed, with early trading showing more modest declines.

Technology stocks are at the forefront of this downturn. Investors, who had previously piled into these stocks due to their impressive year-to-date performance of over 23%, are now seizing the opportunity to cash in their profits. This sector had garnered enthusiasm as software companies expanded their artificial intelligence capabilities and demand for AI chips surged. However, the trend appears to be reversing as profit-taking sets in.

Adding to the market's woes is the rise in the 10-year Treasury yield, which has climbed to 4.3%. This marks an increase of nearly a full percentage point in just one month. The surge in yields is driven by the perception that the economy's current strength may sustain some degree of inflation and high interest rates moving forward. For technology companies, this is particularly problematic as higher long-term bond yields devalue future profits. Many tech firms rely on the expectation of significant future earnings, making them vulnerable to shifts in bond yields.

Despite reporting better-than-expected earnings, tech giants Microsoft and Meta Platforms have not managed to escape the downward trend. Both companies saw their stock prices fall sharply on Thursday, contributing to the overall slump in the tech sector. Given their combined market value of around $4.5 trillion, the decline in these stocks has exerted considerable pressure on the Nasdaq.

In summary, the stock market is facing a significant downturn with tech stocks leading the charge. Rising bond yields and profit-taking activities are exacerbating the situation, leaving investors wary of future developments.