Dow takes 800-point dive Monday amid major tech selloff

All three US benchmarks closed sharply lower as tech shares broke a 10-day winning streak

Barnes & Noble Education - Wall Street heads for mixed open with Nasdaq once again expected to be the star

4 pm: Tech stocks start bad, finish worse

The Dow Jones Industrial Average lost 807 points, 2.8%, on Monday, falling to 28,292. The Nasdaq shed nearly 5% to 11,458 and the S&P 500 dropped 3.5% to 3,455.

The tech sector was among the biggest laggards, snapping a 10-day win streak, according to CNBC. Apple Inc (NASDAQ:AAPL) dipped 8% to $120.88, Microsoft Corporation (NASDAQ:MSFT) lost 6.2% to $217.30 and Facebook Inc (NASDAQ:FB) fell 3.8% to $291.12.

2.40pm: Wall Street shares still plunging

Wall Street shares were still seeing deep red on Thursday afternoon, with the Dow Jones Industrial Average down over 744 points at 28,356.

The S&P 500 lost over 119 points at 3,461, while the Nasdaq plunged more than 566 points at 11,490.

Shares in electric vehicle giant Tesla (NASDAQ:TSLA) were in decline again, losing almost 8% at US$411.51 as the seeming correction from its post-stock-split record close earlier this week looks set to extend to a third consecutive session. If the stock opens at current implied prices, the stock would be down 16.3% since Monday's record close of US$498.32.

1.45pm: Wall Street benchmarks tanking

Wall Street shares were tanking after lunch in New York with tech stocks taking a huge hit.

Apple (NASDAQ:AAPL) shares sank 6.43% to US$122.95 while Salesforce.com Inc (NYSE:CRM) dropped 6% to US$260.17 - causing  a big drag on the  Dow Jones, which plunged over 819 points, or 2.81% to 28,281.

The S&P 500 also tanked, shedding over 127 at 3,452.  The Nasdaq index fell over 602 points, or 5%,  at 11,454.

12pm EST/ 5pm: FTSE 100 closes down

FTSE 100 index closed lower on Thursday as the tech stock sell-off across the Pond spooked traders.

Britain's blue-chip benchmark closed the day down around 90 points, or 1.52%, at 5,850, while the mid-cap FTSE 250 plunged over 223 points at 17,480.

On Wall Street, all three major benchmarks fell despite better than expected jobless claims data in the US for the week to August 29, which showed 881,000 Americans filed for unemployment benefits, against estimates of 940,000.

"To an extent today's sharp slump in tech stocks appears to be a case of shifting assets, with better-than-expected jobs data and rising expectations of a Trump election win boosting the case for investment in those stocks heavily hit throughout this crisis," said Joshua Mahony, senior market analyst at online trader IG.

"With continuing claims below 14 million for the first time since April, and initial claims at a five-month low, there is plenty of optimism as we head towards tomorrow’s jobs report. Nonetheless, not all good news is good for markets, with some fearing how improved economic data could restrict the size of any future stimulus packages."

US and Canada 11am EST/4pm

Wall Street got off to a weak start on Thursday as tech giants led markets lower.

The Dow Jones Industrial Average shed over 343 points at 28,756. The broader-based S&P 500 index lost over 71 at 3,509. The tech heavy Nasdaq exchange lost over 435 points at 11,620.

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9.40am: Wall Street stumbles

Despite expectations of a mixed open, the main Wall Street indices slipped into negative territory in the early minutes of Thursday’s session despite a better than expected jobless claims report.

Shortly after the opening bell, the Dow Jones Industrial Average was down 0.15% at 29,056 while the S&P 500 fell 0.5% to 3,562 and the Nasdaq dropped 1.48% to 11,878.

The tech-heavy Nasdaq had been predicted to open in the green earlier today, however investors seemed content to engage in profit-taking following a seemingly endless march higher form the main indices.

The Nasdaq’s performance may have been affected by Facebook Inc (NASDAQ:FB), which sank 2.77% to US$294.11 in early deals after the social media giant said it will ban new political ads in the week leading up to the presidential election on November 3 in an effort to reign in misinformation on its platform.

Market sentiment also remained unmoved by jobless claims data for the week ended August 29, which showed 881,000 Americans filed for unemployment benefits during the period, down from just over 1 million in the previous week and below estimates of around 940,000.

7.40am: Wall Street heads for mixed open

US markets are tipped to see more of a mixed open on Thursday, with the Nasdaq once again leaving the other main indices in the dust.

The tech-heavy index is set to open at just under 12,300, up 44 points, while the Dow Jones Industrial Average is tipped to dip to 29,070, down 30 points from last night’s close, and the S&P 500 is seen opening its account 15 points lower at 3,566.

“On Wall Street, the record rally continues and appears unstoppable. It is not only tech stocks benefiting from the renewed risk appetite, but increasingly other sectors too, which is a healthy sign,” said Milan Cutkovic, a market analyst at AxiCorp.

Technically, it is impossible for an index to rally – i.e. recover from a setback – when it is at an all-time high, but we get what Cutkovic means.

“Recent economic data have raised hopes for a relatively swift recovery. While the pandemic keeps the uncertainty at a high level, investors are not overly worried about the increase in COVID-19 cases, as governments and central banks worldwide have taken decisive measures.

“Furthermore, the US Centers for Disease Control and Prevention told states to prepare for a coronavirus vaccine by November.,” Cutkovic continued.

“It is an aggressive goal but reiterates that the race to find an effective vaccine is making progress,” he concluded.

US traders have numerous macroeconomic releases to look forward to, including the non-manufacturing ISM (Institute for Supply Management) and final services purchasing managers’ index (PMI) for August, and July’s final trade data.

“Moreover, after yesterday’s big downside surprise in the ADP employment index (428k), and ahead of tomorrow’s August payrolls report, this afternoon will bring Challenger job cuts figures and, in particular, weekly initial jobless claims numbers,” observed Daiwa Capital Markets.

Five things to watch for on Thursday:

  • US jobless claims data for the week to August 29, which are expected to show 950,000 American workers filed for unemployment benefits during the week, down from just over 1 million in the preceding week but still well above the 665,000 weekly peak during the Great Recession in 2009
  • The US trade deficit data for July may also attract some notice on the macro calendar. The deficit narrowed to US$50.7 billion in June from US$54.8 billion in May as the global economy recovered from the pandemic shock, so many will be hoping this trajectory continues
  • Final reading of the US services PMI for August, with the initial reading showing a rise to 54.8 from 50 in July, above expectations of 51. There will also be the final reading of the composite PMI, which rose to 54.7 from 50.3 month-on-month
  • Earnings data from bookshop chain Barnes & Noble Education Inc (NYSE:BNED), which follow the company’s decision last month not to put itself up for sales following a strategic review

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