Stock Market News For August 11, 2017
Zacks Investment Research | Aug 10, 2017 09:55PM ET
Benchmarks suffered their worst one-day percentage drop since the middle of May. The Dow not only lost grip of the psychological 22,000 level but also finished near session lows. Losses in shares of Apple and Goldman Sachs weighed on the blue-chip index. The S&P 500 also ended in the red after a broad based sell off ensued due to rising tensions between Pyongyang and Washington. Decline in shares of technology stocks weighed on the Nasdaq and dragged it lower as well.
The Dow Jones Industrial Average (DJIA) closed at 21,844.01, declining by 0.9% or 204.69 points. The S&P 500 Index (INX) declined 1.5%, decreasing 35.81 points to close at 2,438.21. Meanwhile, the Nasdaq Composite Index (IXIC) closed at 6,216.87, slipping 135.46 points or 2.1%. A total of around 6.48 billion shares were traded on Thursday, above the last 20-session average of 7.5 billion shares. Declining issues outnumbered advancers on the NYSE by 6-to-1 ratio. On the Nasdaq, decliners outnumbered advancers by a 3.60-to-1 ratio.
Benchmarks Slip to Worst Levels since mid-May
Dow lost grip of the psychological 22,000 milestone on Thursday to finish near the session lows. This was triggered by plunging shares of tech behemoth Apple (NASDAQ:AAPL) and Goldman Sachs (NYSE:GS) , which lost 3.2% and 2.4% respectively. Only three of the 30 components which make up the blue-chip index finished in the positive territory. Losses were primarily attributable to a broad-based sell-off as tension between Washington and Pyongyang escalated. Investors are now looking to take profits off the table after what has been a good earnings season. This decline comes a week after the Dow crossed the 22,000 landmark for the first time.
The S&P 500 exhibited a steep decline after ten of its eleven primary sectors finished in the red on Thursday. Technology Select Sector SPDR (XLK) nosedived about 2.0% followed by Financial Select Sector SPDR (XLF) which declined 1.8%. The index has also fallen below its 50-day moving average for the first time in a month. This is also the S&P 500’s worst performance after it fell 1.8% in the middle of May. This dip came as a shock given the fact that the index was down just 0.1% for the entire week entering into the session.
The Nasdaq finished in negative territory due to falling tech shares. Shares of Apple, Alphabet (NASDAQ:GOOGL) , Amazon (NASDAQ:AMZN) and Netflix (NASDAQ:NFLX) all declined due during the selloff which ensued because of the ongoing geopolitical tussle.
North Korea Dismisses Trump’s Warnings
Earlier in the week President Trump commented that North Korea would face “fire and fury” if the renegade country continues threatening the US. On Thursday, North Korea dismissed these claims as “load of nonsense” and continued threatening the U.S. by laying out plans to attack the Guam Naval base and announcing it to the media.
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Investors were worried by such developments and all three benchmarks closed lower for the third day in a row. The Dow is trading 1.2% off its closing record, while the S&P 500 and the Nasdaq are 1.7% and 3.2% respectively off their all-time highs. Thursday also marked the worst one-day percentage drop of the benchmarks.
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