After a month of stock rallies that sometimes seemed to defy logic, markets continued their downward spiral for the second day in a row on Friday, driven by a frenetic sell-off of tech stocks.
In midday trading, the Dow Jones Industrial Average was down about 1,300 points from its Wednesday high, while the tech-heavy Nasdaq was down about 8% from the same period.
Companies that have been among the biggest COVID-era winners are now getting dinged by selloffs, including Amazon, Facebook, and Apple, all of which were down about 4% on Friday afternoon.
Tesla, whose shares have more than quintupled since the start of this year, has taken the biggest hit, tumbling about 20% since its stock split that took effect on Monday.
Although news around the coronavirus pandemic, vaccine developments, and the U.S. presidential election has left the market open to volatility in general, no single event appears to be driving this week’s selloff. One investment expert who spoke with MarketWatch chalked it up “profit-taking”—basically, investors looking to cash in while the price is high. Others have described it as a “healthy correction,” as CNBC reports.
Whatever you call it, it comes as the Financial Times is claiming to have “unmasked” one of the biggest drivers of the recent rally. Japanese conglomerate SoftBank has apparently been gobbling up U.S derivatives as part of a shifting investment strategy, FT reports, in part because some of the tech startups it backed for its $100 billion Vision Fund have not fared so well during the pandemic.
Recognize your brand’s excellence by applying to this year’s Brands That Matter Awards before the early-rate deadline, May 3.
