BREAKING: Wall Street’s main indexes are facing sharp declines, marking a troubling second consecutive session of losses driven by escalating concerns over the economy and soaring tech valuations. The tech-heavy Nasdaq Composite plunged nearly 2.0 percent on Thursday, leading analysts to predict significant weekly losses as investor sentiment soured.
The S&P 500 and the Dow are on track for their steepest weekly losses in four weeks, with the Nasdaq poised for its worst week since March. In early trading today, the Dow Jones Industrial Average fell 138.50 points or 0.30 percent to 46,773.80, while the S&P 500 dropped 46.63 points or 0.69 percent to 6,673.69. The Nasdaq Composite lost 278.31 points or 1.21 percent, settling at 22,775.68.
Sam Stovall, chief investment strategist at CFRA Research, expressed concerns over a potential market pullback, stating, “There is a continuation of the concern of a possible pullback… it’s traditional early November weakness triggered by elevated valuations and the running out of catalysts to support or propel the market.”
Despite this year’s initial optimism surrounding artificial intelligence pushing markets to all-time highs, fears over the monetization of tech and circular spending within the sector have dampened investor enthusiasm. Major tech players, including Nvidia and Broadcom, saw significant drops of 2.8 percent and 2.2 percent respectively, contributing to the broader tech sector’s decline.
Adding to the market’s woes, the CBOE Volatility Index, often referred to as Wall Street’s fear gauge, surged to its highest level in over two weeks. Meanwhile, Tesla shareholders approved a historic corporate pay package for CEO Elon Musk, yet shares fell 3.3 percent, reflecting the overall negative sentiment.
On the earnings front, Expedia experienced a remarkable 16 percent surge after it raised its full-year revenue growth forecast and reported better-than-expected third-quarter profits. In stark contrast, Block plummeted 10.5 percent after missing profit expectations, while Take-Two Interactive fell 6.6 percent following a delay in the highly anticipated video game GTA VI, now set for November 2026.
As the longest US government shutdown in history continues, the economic repercussions are becoming increasingly dire. White House economic adviser Kevin Hassett warned that the shutdown could exacerbate an economic slowdown, stating, “The economic impact of the shutdown was far worse than expected.” Current data reflects a divided Federal Reserve on future monetary policy, with mixed signals emerging from private sector reports.
Consumer sentiment is also wavering, with the University of Michigan’s Consumer Sentiment Index showing a preliminary reading of 50.3 this month, significantly lower than the estimated 53.2. Stovall highlighted the uncertainty surrounding the consumer and investor outlook, noting, “It’s not just the Fed that is flying blind; it is the American consumer and investor as well.”
The market’s instability is palpable, with declining issues outnumbering advancers on both the NYSE and Nasdaq. The S&P 500 recorded 8 new 52-week highs and 10 new lows, while the Nasdaq Composite saw 18 new highs and a staggering 211 new lows.
As this situation develops, investors are urged to stay alert to ongoing economic indicators and market movements. The urgency surrounding these updates cannot be overstated, as Wall Street grapples with challenges that could significantly impact the financial landscape in the coming weeks.
