Wall Street slump is worst since june

Steep losses in tech stocks dragged the rest of the market down, sending the Dow to an 808-point loss.

Wall Street’s euphoria took a break Thursday, as steep losses in technology stocks dragged the rest of the market down with them.

The S&P 500 fell 3.5%, the biggest decline for stocks since early June, when investors were dealing with a surge of coronavirus infections in places like Florida, Texas and Arizona. There seemed to be no explicit catalyst for the sell-off, with economic data coming in roughly where the market had expected and no companies issuing foreboding warnings.

That said, the market felt due for a breather, investors said. Both the S&P 500 and Nasdaq hit record highs just the day before. Prior to Thursday, the S&P 500 had risen nine out of the previous 10 days.

The Dow Jones Industrial Average fell 807.77 points, or 2.8%, to 28,292.73. It was briefly down 1,000 points. The day before, the Dow crossed 29,000 for the first time since February.

The S&P 500 index lost 125.78 points, or 3.5%, to close as 3,455.06. The technology-heavy Nasdaq dropped 598.34 points, or 5%, to 11,458.10.

Apple dropped 8%, Amazon lost 4.6% and Facebook gave back 3.8%. The Big Tech stocks have made massive gains this year. Investors have been betting those companies would continue posting huge profits as people spend even more time online with their devices. They’ve also assigned lofty market values to new-found darlings such as Zoom Video Communications as many Americans work remotely and students do online learning.

Market watchers have been questioning recently whether those gains were overdone. Apple is still up 64.7% for the year, and Amazon is up 82.3%. Zoom’s gain for the year is still a whopping 460.4%.

The government reported early Thursday that the number of Americans who applied for first-time unemployment benefits fell last week to 881,000, slightly better than what economists had expected. That said, companies are still letting workers go at numbers well above those seen in the Great Recession, meaning the jobs picture remains still extremely bleak despite recent improvements.