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Dow in Biggest Slump Since June as Tech Bulls Scatter on Volatility Spike

Stock MarketsSep 03, 2020 04:06PM ET
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© Reuters.

By Yasin Ebrahim

Investing.com – The Dow closed sharply lower on Thursday as big tech stocks fell out of favor amid a jump in volatility and mixed economic data ahead of the key jobs report due Friday. 

The Dow Jones Industrial Average fell 2.78%, or 808 points, the S&P 500 was down 3.46%, while the Nasdaq Composite slumped 4.96%.

A sea of red of washed over mega-cap tech stalwarts forcing traders to pull their bullish bets and reassess whether the recent run-up in the market was too much, too soon. 

Apple (NASDAQ:AAPL) fell about 8% to lead the move lower in the Fab 5 stocks, with Microsoft (NASDAQ:MSFT), Amazon.com (NASDAQ:AMZN), Facebook (NASDAQ:FB) and Alphabet (NASDAQ:GOOGL) ending the day deep in the red. 

Sentiment on Google-parent Alphabet was further soured on reports that federal prosecutors could file an antitrust case against the tech giant as soon as this month.  

A sharp rise in volatility also rattled investors, with the CBOE Volatility Index, the so-called fear index, surging 25% to a nearly two-month high.

Energy joined the selloff late as oil prices struggled amid ongoing concerns over the strength of crude demand.

Better-than-expected jobs data and softer services growth did little to improve sentiment on the economic recovery a day ahead of the release of August's nonfarm payrolls report.

The ISM non-manufacturing index slowed to a reading of 56.9 last month, from 58.1 in July, missing economists' forecasts for a reading of 57.

"The August ISM Non-Manufacturing report showed a modest decline to 56.9 from 58.1. Technically, this is the lowest level since the index began to improve coming out of the COVID-induced lockdowns in the Spring, but 56.9 is still a very strong outright reading," Jefferies (NYSE:JEF) said.

The U.S. Department of Labor reported Thursday that initial jobless claims fell to 881,000 in the week ended Aug. 28, beating forecasts of 950,000.

In other news, Help desk software provider Pagerduty (NYSE:PD) saw its narrower-than-expected quarterly loss overshadowed by softer full-year guidance, sending its shares down 26%.

Dow in Biggest Slump Since June as Tech Bulls Scatter on Volatility Spike
 

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Comments (23)
perplexed76 .
perplexed76 . Sep 03, 2020 11:05PM ET
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standard correction. nothing new so far
Thom Miller
Thom Miller Sep 03, 2020 9:28PM ET
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Wow! Today I really got under the skin of all those uneducated Trumpers. And they knew they didn’t have a factual leg to stand on. Of course, what would you expect....this is the same uninformed crowd of Trumpers who believed Donnie when he told them all to inject themselves with Lysol. Now their brains are even more fried than before....If there’s one thing worse than a Trumper, it’s a Zombie Trumper.....LOL!
Phil Ht
Phil Ht Sep 03, 2020 9:28PM ET
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Wow. Arrogant X’s 10
Jay West
Jay West Sep 03, 2020 9:08PM ET
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Anyone buying BAC options?If so, which ones?When will stock break $27?
king michael
king michael Sep 03, 2020 8:19PM ET
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Market has to crash now. It is designed in Trump election plan. Nasdaq may drop 3000 to 6000 points in a week or two. FED and Trump alliance will then below another stock market bubble again starting the third week this month as it is the only thing Trump can brag for his re-election.
Kelly Mayer
Kelly Mayer Sep 03, 2020 7:45PM ET
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And 90% o covid case numbers are fake. Fact check here - https://www.rt.com/op-ed/499816-positive-covid-virus-contagious/
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John Wommack
John Wommack Sep 03, 2020 7:45PM ET
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Get out of America, Comrade.
Plopseven Schwartz
Plopseven Schwartz Sep 03, 2020 7:45PM ET
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Aren’t you late for fluffing an OANN reporter, Kelly?
Thom Miller
Thom Miller Sep 03, 2020 7:45PM ET
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Kelly is a girl’s name....you’re the one who’s faking....
Kelly Mayer
Kelly Mayer Sep 03, 2020 7:45PM ET
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This keeps happening again and again.. Dem supporters in this website have the lowest ability of counter argumenting i have ever seen... Just read those comments above... I mean, really? Where is the depth,? research?  argumentative eloquence? Independent thinking? ...At least put on some effort... But It gets worse... Intolerance for independent thinking... comments bordering on misogyny just above this one... dear god i can't believe these people live in 2020... you belong in  Biden's team, you know, the one that lost the run a long time ago.
Tre Hsi
Tre Hsi Sep 03, 2020 7:45PM ET
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Kelly Mayer  "you belong in  Biden's team, you know, the one that lost the run a long time ago."  -- you mean the team that's currently up by 9% in the polls?
Miyazaki Zachary
Miyazaki Zachary Sep 03, 2020 7:37PM ET
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Dow is testing resistance on 28k points. Dow climbed from 18576 in March to 28292 today. Even due to questionable pandemic and all lockdown measures. Not to mention S&P and Nasdaq performance. I believe the Trump's economic effort and policy are heading to the right direction fighting all this difficult circumstances. I would go for Travelers, Goldman Sachs, and Merck
king michael
king michael Sep 03, 2020 7:24PM ET
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NASDAQ future down another 200 points. The slaughter has started. 1000 Nasdaq dive is expected tomorrow. With so much free money loaned  from Trump government, large wealth funds owned by the wealthy are in total control of the market. It will take all the money from working american including your retirement money through market manipulation. Trump is the most powerful president ever in US history.
Plopseven Schwartz
Plopseven Schwartz Sep 03, 2020 7:24PM ET
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Opening your henhouse to the wolves doesn’t make you a “powerful” farmer.
Miyazaki Zachary
Miyazaki Zachary Sep 03, 2020 7:15PM ET
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This article title just to incite bearish speculation. I could agree on the content but the title seems negative.
Thom Miller
Thom Miller Sep 03, 2020 6:43PM ET
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Today’s Dow decline almost 3X the largest single day loss during the Obama administration. Trump has ruined the economy and now the stock market....oh, and he personally sent nearly 185,000 Americans to their graves.....and climbing....
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Options Trader
Options Trader Sep 03, 2020 6:43PM ET
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Factually untrue. Obama had many days of 3-4% drops. Do you just post whatever you want?
Van Doza
Van Doza Sep 03, 2020 6:43PM ET
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me ish It sounds as though both you and Thom Miller have either the same employer (Soros, perhaps?) or an agent of the Clintons; honest work for honest people is, in fact, available. You really should try harder...
Van Doza
Van Doza Sep 03, 2020 6:43PM ET
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Plopseven Schwartz that doesn't mean you are not a communist....
Thom Miller
Thom Miller Sep 03, 2020 6:43PM ET
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Options Trader Liar! Liar! Pants on Fire!
me ish
me ish Sep 03, 2020 6:43PM ET
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Van Doza  no - not a Dem supporter either - just a seer of truth - which isn't difficult - you guys are so in denial - Trump actually says these things - live on air - you can't then call it fake news that he hasn't said these things - he really has said that Putin is terrific - he has alienated so many democratic world leaders whilst supporting despots from non democratic countries and please don't tell me Russia is a democracy - alongside for instance Belarus - that famous democracy with really free and fair voting.
Camaro Camero
Camaro Sep 03, 2020 5:40PM ET
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Dow kicked out PFE and XOM and got what the deserved today!  I keep telling you guys to buy more XOM. It's VERY safe look what happened today. DOW tanked, NASDAQ sunk and XOM down - 0.20%! Can't complain about something that protects your downside like that!
Kapil Dahal
Kapil Dahal Sep 03, 2020 5:33PM ET
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Is s&p 500 announcing adding of company tomorrow?
Kapil Dahal
Kapil Dahal Sep 03, 2020 5:33PM ET
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Is s&p 500 announcing adding of company tomorrow?
Kapil Dahal
Kapil Dahal Sep 03, 2020 5:32PM ET
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Is s&p 500 announcing adding of company tomorrow?
Marco cuevas
Marco cuevas Sep 03, 2020 5:32PM ET
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Thank you bears buying the red dip thank you.
Raksaksa Tonne
Raksaksa Tonne Sep 03, 2020 5:21PM ET
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More magic money please!! lol
Dennis Kendrick
Dennis Kendrick Sep 03, 2020 5:21PM ET
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Magic money is useless without a magic vaccine.
me ish
me ish Sep 03, 2020 5:21PM ET
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Dennis Kendrick  vaccine is totally pointless and unnecessary - almost no-one needs a vaccine - and there's more chance of having serious side effects or death from the vaccine than there is from Covid - all attempts at vaccines for other coronaviruses in the past have, at best just not worked and at worst have killed and maimed tens of thousands of people - usually kids in far off places that most Americans don't care about and the media will never tell them, so they can stay ****ignorant.
Mario tragik
Mario tragik Sep 03, 2020 5:19PM ET
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June bulls ? who are those the FED?
me ish
me ish Sep 03, 2020 5:19PM ET
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yep - only thing is with the USD up until two days ago (DXY) starting to drop like a stone, I don't think the FED feels it can keep printing much more - so now, the FED are going to let this baby tank - but all the insiders have already sold out and are now shorting.
James Dorward
James Dorward Sep 03, 2020 5:09PM ET
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buy and hold. long term investors is the key. stocks cant rise everyday. all good no worries here.
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Fluffy Clucks
ChuckKay Sep 03, 2020 5:09PM ET
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Sell here. The runup to this point has been huge. Anyone expecting more upside at thus point lacks sense. There is going to be the bargain sale of a lifetime at some point ahead, and it could take years to get back to current prices.
Chris Poulos
Chris Poulos Sep 03, 2020 5:09PM ET
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it took nasdaq almost 15 years to get back to the highs it reached in 2000. buy & hold is not a good strategy right now. SELL is a good strategy.
James Dorward
James Dorward Sep 03, 2020 5:09PM ET
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Stay in for the long term is always the best strategy.
Fluffy Clucks
ChuckKay Sep 03, 2020 5:09PM ET
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James Dorward    Interest rates can't go lower.  There are bubbles everywhere--in fact so much so that it is not a stretch to believe we are at a historic moment.  My goodness, no, staying in for the long run is absolutely not even a moderately good strategy in your worst nightmare at this point.  You can thank me later.  Talk to anyone who bought stocks in 1929 or in 1989 in Japan and you will understand.  Hit the sidelines while you still can.
me ish
me ish Sep 03, 2020 5:09PM ET
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Mario tragik  exactly - like around the end of March - that was a good time to buy - and of course there is the third option of just holding cash for a while to see what happens - the market is way overpriced so there's a great likelihood that we can all buy in about six months to a year's time when the market prices are far more aligned with the dreadful global economy.
Michael Garrett
Michael Garrett Sep 03, 2020 4:38PM ET
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don't worry trump and company will come crying to pelosi to strike a deal and we will be back at ath in no time
Plopseven Schwartz
Plopseven Schwartz Sep 03, 2020 4:38PM ET
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Not going to happen.
Tim Miller
Tim Miller Sep 03, 2020 4:29PM ET
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Here we go!! people decide to take a little gains and you have the markets crashing.
Ben Lee
Ben Lee Sep 03, 2020 4:29PM ET
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Not people, but trading algorithms. Algorithms are triggering big moves.
Tim Miller
Tim Miller Sep 03, 2020 4:28PM ET
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Here we go!! people decide to take a little gains and you have the markets crashing.
me ish
me ish Sep 03, 2020 4:28PM ET
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yeah, then a few more people tomorrow will think - you know what, this market is way overpriced and I might as well take a little gains - and lo and behold, loads of people start doing that and before you know it - you have a crash! That's how crashes start - contagion fear spreads and the FED money printing machines will be burning so hot, they'll stop too.
Bilal Kazmi
Bilal Kazmi Sep 03, 2020 4:22PM ET
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Totally *******.... did dow is in bullish trend tommarow ???
Matius Marvn
Matius Marvn Sep 03, 2020 4:16PM ET
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What is the drama??? only correction , manipulators take this oportunity for buy , Why lie ?
justin namon
justin namon Sep 03, 2020 4:15PM ET
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Did the Chicken come first, or the egg?
Devend Arora
Devend Arora Sep 03, 2020 4:15PM ET
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first, ****came , then Hen and then egg,
Paul Dunne
Paul Dunne Sep 03, 2020 4:15PM ET
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The chicken came first. It evolved from a cat and started laying eggs. :)
 
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