Daily Outlook

Dow drops 800 points as Apple leads tech shares lower

Stocks fell sharply on Thursday as investors paused in the wake of a recent rally to all-time highs. Tech, the market leader since the rebound began in late March, was the biggest laggard. The Dow Jones Industrial Average dropped 801 points, or 2.8%. The S&P 500 slid 3.6% and the Nasdaq Composite fell by 5%. At one point, the Dow was down more than 800 points.

Apple shares fell 7%. Facebook, Amazon and Netflix were all down at least 5%. Microsoft slipped 5.7%. Alphabet pulled back by 4.8%. The S&P 500 tech sector traded 5.5% lower and was on track for its biggest one-day decline since June 11, when it fell 5.8%. The sector was also headed for its first losing session in 11 trading days.

Thursday’s moves came after another record-setting session for the S&P 500 and the Nasdaq Composite. That run-up was powered by cyclical stocks, which move in response to the health of the U.S. economy, and added to the market’s strong move off the March 23 lows.

Since late March, the S&P 500 is up more than 55% and the Nasdaq has rallied nearly 70%. The Dow has surged more than 50% in that time. To be sure, some analysts think it may be time for the market to consolidate some of its recent sharp gains.

Thursday’s decline came even after better-than-expected unemployment data. The number of first-time filers for unemployment benefits totaled 881,000 for the week ending Aug. 29, the Labor Department said Thursday. Economists polled by Dow Jones expected first-time applications to have decelerated to 950,000 during the week ending Aug. 29.

That report came a day ahead of a widely anticipated U.S. jobs report. Economists polled by Dow Jones expect the U.S. economy to have added 1.321 million jobs in August. The jobs report will be released as lawmakers struggle to reach a deal on further coronavirus stimulus.

Dow drops 800 points as Apple leads tech shares lower, CNBC, Sep 3

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