The Dow dove, Wall Street’s fear gauge spiked, and investors rushed to buy Treasuries. The equity markets got slammed Thursday as investors dumped high-flying tech darlings Facebook, Amazon, Netflix and Alphabet. The sell-off came just one day after the S&P and Nasdaq closed at record highs.
The Nasdaq sank 5%. The Dow fell nearly 3% The S&P 3.5%.
Crossmark Global Investments’ Victoria Fernandez had advised investors last month to trim their big tech holdings.
“When we see these momentum stocks really start to take a pullback, it shouldn’t be a big surprise. When we’ve had names like Apple up 70% since their March lows, the broader indices 50-70% year-to-date, I think it’s OK.”
Tesla, whose shares have quadrupled this year, dropped for a third straight day. On Wednesday, a key shareholder cut its stake in the electric car maker.
Campbell’s Soups shares fell. The canned food maker sees second half sales falling as consumers go back to dining out. It had earlier benefited as consumers ate at home.
Investors didn’t find any encouragement in economic data. The number of Americans filing new unemployment claims last week fell but remained extraordinarily high, and growth in the services sector slowed in August.
On Friday, investors will get the jobs report. Economists expect nonfarm payrolls growth to have slowed in August to 1.4 million.