Nasdaq Ends Significantly Lower as Investors Stay Away From Big Tech Financial Market News

The Nasdaq ended much lower on Thursday as the U.S. Federal Reserve announced its prediction of a faster end to the pandemic-era recovery, pushing investors away from Big Tech and pushing economically sensitive sectors.

Nvidia, Apple, Microsoft, Amazon and Tesla fell between 2.6 percent and 6.8 percent, to Nasdaq and the S&P 500, and the Dow Jones Industrial Average fell slightly.

Most of these high-growth stocks have surpassed the broader market by 2021, and to date Nvidia has risen more than 100 percent.

The Dow Jones Industrial Average fell 0.08 percent to 35,897.64, while the S&P 500 lost 0.87 percent to 4,668.67.

The Nasdaq Composite Index fell 2.47 percent to 15,180.44.

The U.S. central bank said on Wednesday it would end its bond purchases in March and announced a three-quarter-percent increase in interest rates by the end of 2022.

This was welcomed by investors who are increasingly concerned about the rising inflation associated with the coronavirus pandemic. But on Thursday, it helped sell growth stocks.

The S&P 500 index rose 0.7 percent, while the growth index fell 2.1 percent, reflecting investor feedback that high-growth stocks tend to perform poorly when interest rates rise. The value index includes stocks that are more likely to perform well in the economic recovery.

“You’re seeing money coming out of growth, as it should be. If we enter an environment where interest rates are rising, growth stocks will not be so attractive, ”said Dennis Dick, a trader at Bright Trading LLC.

“There’s a lot of uncertainty as we go into 2022 … We’ll have a blacker Fed that will remove the punch bowl,” he said.

Among the top 11 S&P 500 indexes, technology fell 2.9 percent and finance rose 1.2 percent. Eight of the sectors won, although the overall index fell.

“The Fed gave the market what it wanted, and now I think investors are once again facing pandemic uncertainty, and they are also cautious by the end of the year,” said Lindsey Bell, chief investment strategist at Ally Invest.

Recent readings on rising producer and consumer prices, as well as the rapid spread of the Omicron variant of coronavirus, have sparked anxiety. The S&P 500, however, continues to grow by about 25 percent in 2021 and is trading on record.

The CBOE Volatility Index, often seen as a measure of Wall Street fear, fell to a three-week low.

The data show that the number of Americans filing new unemployment benefit claims over the past week has risen sharply, keeping levels in line with harsh labor market conditions.

In particular, a survey showed that production at U.S. factories rose to a three-year high in November in almost three years.

Lennar Corp. fell 4.1 percent after homeowners lost analysts’ quarterly earnings estimates as pandemic supply chain problems pushed up wood costs and delayed home deliveries.

Declining issues outperformed the NYSE with a ratio of 1.03 to 1; On the Nasdaq, the 1.93-to-1 ratio favored the decline.

The S&P 500 released 69 new 52-week highs and three new lows; Nasdaq Composite recorded 43 new highs and 184 new lows.

US trading volume was $ 11.6 billion a share, an average of the last 20 trading days.