Stock Market Today: Wild Friday Features More Woes for Tech
Big Tech stocks Apple (AAPL), Amazon.com (AMZN) and Microsoft (MSFT) all declined on a wobbly 'quadruple witching' Friday.
Friday was expected to be an active day for stocks, and, on that front, it didn't disappoint.
Today was a "quadruple witching" day, in which index futures, index options, stock options and individual-stock futures all expire at once, which sometimes leads to heavy volume and erratic moves in parts or all of the market. In this case, the major indices flipped from early gains to deep losses, then recovered somewhat before closing in the red. The Dow Jones Industrial Average finished 0.9% lower to 27,657.
Friday continued a brutal stretch for tech. The S&P 500's technology sector, as measured by the Technology Select Sector SPDR Fund (XLK, -1.7%), has declined 9.5% since the start of September. Apple (AAPL, -3.2%) has declined 17% this month, Amazon.com (AMZN, -1.8%) is off 14.4% and Microsoft (MSFT, -1.2%) is off 9.8%.
Other action in the stock market today:
- The Nasdaq Composite dropped 1.1% to 10,793, putting it down 8.3% for September.
- The S&P 500 also fell 1.1% to 3,319.
- The Russell 2000 was the strongest of the major indices, slipping 0.4% to 1,536.
Too Rocky for Your Tastes? Build a More Diversified Core
As we detailed in our A Step Ahead newsletter today, the tech sector might not be a bubble waiting to pop, but it is a particularly frothy area of a generally expensive market that's still ripe for profit-taking.
"The equity market's recent volatility reflects uncertainty surrounding the pandemic, the presidential election and fiscal policy," says Thomas Mantione, managing director, UBS Private Wealth Management. "The acceleration of digital, virtual and e-commerce trends has caused valuations in the tech sector to expand. But as we've seen, the tech sector is not immune from the volatility that could be caused by the lack of fiscal policy response to COVID-19 and uncertainty surrounding the 2020 election."
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