Nasdaq Down Over 2% As Tech Stocks Fall At The Conclusion Of A Volatile Week

Mixed jobs statistics, uncertainty surrounding the Omicron coronavirus variety, and the route of the Federal Reserve’s policy tightening dragged on Wall Street’s main stocks on Friday, with the Nasdaq falling more than 2%.


The S&P 500 technology index (.SPLRCT) fell 1.9 percent, outperforming the other 11 major sectors. Inc (AMZN.O), Apple Inc (AAPL.O), Alphabet Inc (GOOGL.O), Meta Platforms (FB.O), Microsoft Corp (MSFT.O), Tesla Inc (TSLA.O), and Nvidia Corp (NVDA.O) all saw their stock prices drop between 1.4 percent and 6.1 percent, weighing the most on the S&P 500 and Nasdaq.

Paul Nolte, portfolio manager at Chicago-based Kingsview Asset Management, said:

“What you’re seeing is the impact of technology, which is directly related to Apple, Microsoft, and Nvidia, among others. It’s the inverse of what we’ve seen in the past, where the big stocks are the main drivers of the index.”

Wall Street opened higher since the Labor Department reported those nonfarm payrolls raised less than anticipated in November, but the rate of unemployment fell to 4.2 percent, its lowest level since February 2020, and wages risen further.

According to Nolte, the numbers show that the economy is doing very well. So it confirms some of the things Powell said on the Hill this week, and it lends support to the notion that the Fed will likely become more aggressive.

Fed Chair Jerome Powell stated earlier this week that the bank may contemplate a speedier wind-down of its bond-buying program at its forthcoming meeting to combat rising price pressures, a move largely perceived as paving the way for early interest rate hikes.

The cyclical Dow and economy-sensitive S&P sectors, such as industrials, energy, materials, and financials, fared significantly better throughout the day’s broad selloff.

Meanwhile, in November, an index of US services industry activity reached a new high as employers increased hiring.

As investors processed reports on the newly discovered Omicron variant, which is expanding worldwide and driving countries to reinstate travel bans, equity markets swung violently this week.

The Dow is on track for its fourth straight weekly loss, while the other two indexes are on track for significant weekly losses as well.

The CBOE Market Volatility Index (.VIX), Wall Street’s fear barometer, was last traded at 30.70 points.

The Dow Jones Industrial Average (.DJI) was down 60.24 points, or 0.17 percent, at 34,579.55. ET, the S&P 500 (.SPX) was down 41.62 points, or 0.91 percent, at 4,535.48, and the Nasdaq Composite (.IXIC) was down 319.08 points, or 2.07%, at 15,062.25.

DocuSign Inc (DOCU.O) fell 40% after the electronic signature solutions company reported lower-than-expected fourth-quarter sales.

Nucor Corp (NUE.N) gained 3.7 percent after the steel products company launched a $4 billion buyback programme and hiked its quarterly dividend by 23 percent.

On the NYSE, decliners outweighed advancers 2.52 to 1 and on the Nasdaq, decliners outpaced advancers 3.94 to 1.

This week, the S&P 500 index made 8 new 52-week highs and 5 new lows, whereas the Nasdaq Composite had 12 new highs and 580 new lows.

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