Tech tumble jams Wall Street into reverse; sharpest one-day fall since June

Tech tumble jams Wall Street into reverse; sharpest fall since June

 

Markets had soared from March lows, powered by fiscal and monetary support hopes for a swift economic recovery. But some participants said investors had become too optimistic.

The Economic Times

NEW YORK: Wall Street's main indexes closed sharply lower on Thursday, marking their deepest one-day declines since June as investors dumped the high-flying technology sector, while economic data highlighted concerns about a long and difficult recovery. The Nasdaq led the pullback with a decline of almost 5% a day after it and the S&P 500 posted record closing highs.

The Nasdaq's biggest drags came from heavyweights Apple Inc , Microsoft Inc, Amazon.com Inc, Tesla Inc and Nvidia Corp. The S&P tech sector and the Philadelphia chip index both fell almost 6% on the day. Markets had soared from March lows, powered by fiscal and monetary support hopes for a swift economic recovery. But some participants said investors had become too optimistic.

"Think about the mounting number of risks the market has been shrugging off over the last couple of months here," said Emily Roland, co-chief investment strategist at John Hancock Investment Management. "We're 60 days away from the election. That may be an area where investors are getting a bit spooked."

She added: "Looking at the data today, the market has had the ability to power higher and hasn't paid any attention to a macro environment which, yes, is improving which is encouraging, but the economy remains fragile here." Earlier in the day, data showed the number of Americans filing new claims for unemployment benefits fell more than expected last week, but remained extraordinarily high. The next big data focus for investors is Friday morning's monthly payrolls report.

Read more...