But the Nasdaq turned positive as investors saw opportunities to buy low as tech companies are expected to struggle this earnings season, said Edward Moya, senior market analyst at OANDA.
He said the news out of China only added to jitteriness of some investors looking at U.S. tech companies set to report this week, including Apple and Amazon. But others see this week as the right time to get in on a big-name tech stock at a discount, he said.
The outlook going forward could be a gloomy one for investors, but there may be a silver lining: The Federal Reserve could slow its parade of rate hikes, according to Moya.
“That's also providing some optimism here that the Fed is going to be done after a couple more rate hikes, and that's really the driving force behind a lot of people buying right now," he said.
While some see an opportunity in a bear market, Moya said investors should be careful when deciding if now is the time to buy into these tech stocks given the amount of people using short-term investing strategies amid choppy markets.
"This little soft patch for the economy is really going to be short lived," he said. "There should be a lot of caution into buying into this rally."
