Investors dumped big tech stocks following a slew of disappointing earnings, putting the Nasdaq 100 Index on course to enter its third technical correction of the year.
The Nasdaq 100 fell as much as 4.5% on Friday to complete a more than 10% drop from its most recent peak. The latest round-trip ride for the tech-heavy gauge was preceded by a drop at the outbreak of the Iran war and a selloff in semiconductor stocks over the summer.
“The entire sector is getting hit, so it’s creating more havoc in the broad stock market,” said Matt Maley, chief market strategist at Miller Tabak Co LLC, of the plunge that sent the gauge to the brink of a correction.
This week’s 3% plunge follows discouraging earnings reports from Google owner Alphabet Inc. and Amazon.com Inc., two heavyweight companies that have been at the forefront of the AI buildout. Intel Corp. and ServiceNow Inc. also reported results that sparked steep declines.
Volatility has become the norm. The last time the market took three or more 10% swings in a single year was in 2022, when surging Covid-era inflation and the Federal Reserve’s rate-hiking regime drove US stocks into a bear market.