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Dow Dives as Bulls Sink Amid Tech Wreck

Stock MarketsOct 30, 2020 03:22PM ET
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© Reuters.

By Yasin Ebrahim

Investing.com – The Dow fell sharply Friday, led by an Apple-fueled selloff in tech following quarterly earnings that failed to live up to expectations, while the ongoing rise in Covid-19 cases also soured investor sentiment.

The Dow Jones Industrial Average fell 1.42%, or 377 points. The S&P 500 was down 1.86%, while the Nasdaq Composite slumped 2.77%.

Tech, which has been leading the broader market rebound since mid-March, is in the selling spotlight as investors mulled a string of quarterly results from FAANG stocks, excluding Netflix (NASDAQ:NFLX).

Apple (NASDAQ:AAPL) fell 6% after its weaker-than-expected iPhone sales overshadowed third-quarter results that beat on both the top and bottom lines. Amazon.com (NASDAQ:AMZN)'s third-quarter results also beat Wall Street estimates, but its underwhelming guidance sent its shares 5% lower.

Facebook (NASDAQ:FB) slumped more than 7% after a fall in user additions, but Wall Street continued to back the stock as the social media giant is expected to benefit from the ongoing "shift of ad spending to digital outlets," Wedbush said in a note.

Google-parent Alphabet (NASDAQ:GOOGL), however, sidestepped the selling, rising 4% as investors cheered signs of a rebound in ad-spending as the search engine giant reported third-quarter results that topped analysts' estimates.

Twitter Inc (NYSE:TWTR) plunged 21% after bucking the trend of sharp user growth seen from other social platforms including Snapchat during the quarter, adding just 1 million users since the end of the second quarter.

Energy exacerbated the selling, falling more than 2%, paced by a decline in oil major Exxon Mobil (NYSE:XOM) on disappointing quarterly results.

The sea of red on Wall Street comes as the sharp spread of the virus continues to raise fears that recent reopening measures could be rolled back, slowing the economic recovery.

"[I]t is very unlikely that the economy will so easily continue along on an uninterrupted positive trajectory, particularly if a resurgence of the virus undermines the progress made July to September," Stifel Economics said in a note.

The likely resurgence of the virus in the winter could potentially lead to "further restrictions or regulations will only serve to complicate the outlook for the global recovery, domestic GDP, policy and, of course, next week’s election."

Dow Dives as Bulls Sink Amid Tech Wreck
 

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Comments (12)
Luis Bustamante
Luis Bustamante Oct 30, 2020 6:06PM ET
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Next Monday and Tuesday will be the last chance to scape .... doors will be narrowing.
Ro Be
Ro Be Oct 30, 2020 4:19PM ET
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Dow Dives as Bulls Sink Amid Tech WreckTech Wreck as Bulls Sink Amid Dow DiveBulls Sink as Dow Dives Amid Tech WreckBubble Pops as Bubble Pops Amid Bubble Pop
Irvin Mermelstein
Irvin Mermelstein Oct 30, 2020 4:11PM ET
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Sure enough, RH investors still buying the dip.
Thom Miller
Thom Miller Oct 30, 2020 4:07PM ET
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The markets continue to react to Trump’s poor handling of the economy and the virus. Trump destroyed the strong economy and stock markets he inherited from Obama/Biden and Trump totally ignored the Pandemic Playbook Obama/Biden left him. And why did Trump ignore the latter? Because Trump hasn’t cracked open a book in 50 years....he’s been too busy cheating on his wives and taxes.
Clinton Powell
Clinton Powell Oct 30, 2020 4:07PM ET
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You must drinkThe only think he inherited from Obama was Pelosi
Fah QQQ
Fah QQQ Oct 30, 2020 3:19PM ET
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Anyone ever tried Rocky Mountain oysters before? If you haven't, you will.
Van Doza
Van Doza Oct 30, 2020 3:19PM ET
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If the simile is about Bull gonads, its a poor one; rocky mtn oysters mostly come from very yound boars
Fernando Lazarini
Fernando Lazarini Oct 30, 2020 3:19PM ET
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I tried Blue Oyster once, never could get out of there.
Christopher Dunson
Christopher Dunson Oct 30, 2020 2:59PM ET
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The Biden effect.
Plopseven Schwartz
Plopseven Schwartz Oct 30, 2020 2:59PM ET
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So the rally was Trump and the crash is Biden? Ha! In the words of Trump: “I take no responsibility.”
Plopseven Schwartz
Plopseven Schwartz Oct 30, 2020 2:59PM ET
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What about Trump’s propaganda? Dude couldn’t even tell the country to wear masks. China is back to normal now and they’re going to crush us economically because of Trump’s ineptitude. Look at the bond markets today. Completely liquidated.
Kilo Byte
Kilo Byte Oct 30, 2020 2:22PM ET
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Reality is finally sinking in.  No, we can't print our way out of financial disaster.
Frederick Chotsky
Chotsky Oct 30, 2020 2:22PM ET
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Reality is sinking into what? 80-90% of daily volume is all algos and HFT.
Space Lord
Space Lord Oct 30, 2020 2:04PM ET
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This ship is sinking
Jeremy Taylor
Jeremy Taylor Oct 30, 2020 2:04PM ET
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This is shocking, i thought investors were over this.... but i guess they was just riding the stimlus wave like the rest of us.
Kilo Byte
Kilo Byte Oct 30, 2020 2:04PM ET
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What else would they be riding?  The economy is dead.  lol
Ron Love
Ron Love Oct 30, 2020 2:03PM ET
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No point buying in right now while the bedwetters are in a full panic.
Irvin Mermelstein
Irvin Mermelstein Oct 30, 2020 2:02PM ET
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Panic selling will accelerate. It's the most studied bit of market psychology. I wonder whether the market priced in a win by Trump. We'll see next Wednesday morning, after Trump bites the dust.
Ken Byron
Ken Byron Oct 30, 2020 1:57PM ET
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About another 2k points to drop before I'll consider tipping my toes in.
Ken Byron
Ken Byron Oct 30, 2020 1:57PM ET
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dipping^
Edward Ronquillo
Edward Ronquillo Oct 30, 2020 1:57PM ET
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there's a big megalodon swimming in that mess. a lot of investors will lose way more than their toes.
 
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