2024-09-03 21:20:29
Wall Street closed sharply lower in today’s session, as the technology sector sank and fresh US economic statistics reignited concerns about the health of the US economy.
The Dow Jones closed down 626.15 points, or 1.51%, at 40,936.93. The S&P 500 fell 2.12% to end at 5,528.93, while the Nasdaq closed down 3.26% at 17,136.30, its worst daily performance since the sell-off on Aug. 5.
The Russell 2000 index of small-cap stocks fell 3.1%.
Stocks came under heavy pressure from technology as Nvidia, the artificial intelligence darling that has captured investors’ attention for more than a year, was in freefall of more than 9%. Other semiconductor stocks including Micron, KLA and Advanced Micro Devices also posted losses. This is the worst session for the technology sector and especially the semiconductor sector since September 2022.
Boeing’s stock also fell 7.3% after being downgraded by an analyst.
Signs of weakening
The market was also shaken by new data showing that the manufacturing sector is showing signs of weakening. The S&P Global index showed a decline in August compared to July, while the ISM index came in at levels slightly lower than analysts had predicted. The data brought back to the fore concerns about a slowdown in the US economy, which had sparked a sell-off early last month.
“The market seems very vulnerable to every statistic. We’ve become completely dependent on data,” says Larry Tentarelli, strategic analyst at Blue Chip Trend Report.
Investors await the August employment data in the US with particular interest. However, September is on average the worst month for the S&P 500 over the last 10 years.
Septembers marks the biggest percentage decline for the S&P 500 since 1950; according to the Stock Exchange’s Almanac. Also, Bank of America’s index of bearish sentiment rose to its highest level in two and a half years last month, well close to the sell-signal level for US stocks.
“In every year since World War II, August and September have been the months in which the S&P 500 posted losses. However, now history advises investors to fasten their seat belts as in election years, this seasonal decline carries over into September and October,” says CFRA’s Sam Stovall.