US STOCKS - Nasdaq, S&P 500 End Sharply Lower, Hit by Chips, Megacaps

WALL STREET - July 17 (Reuters) - The S&P 500 and the Nasdaq tumbled on Wednesday as plunging microchip shares, in the face of potential escalation of U.S. trade conflicts with China, exacerbated the ongoing rotation out of megacap tech-related stocks.

A report that the Biden administration is considering severe trade restrictions against China sent microchip stocks down 6.8%, marking the Philadelphia SE Semiconductor index's biggest one-day drop since March 2020.