Stock Market Today: Nasdaq Spirals as Big Tech Sells Off
Facebook led a selloff in FAANG stocks after a scathing "60 Minutes" report and site outage.
Stocks ended the day deep in the red as investors weighed several worries.
Under the shadow of the rapidly approaching Oct. 18 deadline by which Congress must raise or suspend the debt ceiling so that the U.S. does not default on its financial obligations, the 10-year Treasury yield briefly topped 1.50% before ending up 1.5 basis points (a basis point is one one-hundredth of a percentage point) at 1.482%.
This rise in bond yields sparked a selloff in Big Tech, with Facebook (FB, -4.9%) the most notable decliner.
Last night's "60 Minutes" episode on CBS in which a former FB employee accused the company of misleading the public on the negative effects of its platform put the FAANG stock in Wall Street's sights, while a major outage across all three of its properties – Facebook, Instagram and WhatsApp – did it no favors.
As such, the Nasdaq Composite was by far the day's biggest loser, slumping 2.1% to 14,255. The S&P 500 Index gave back 1.3% to 4,300 and the Dow Jones Industrial Average shed 0.9% to 34,002.
Other news in the stock market today:
- The small-cap Russell 2000 fell 1.1% to 2,217.
- Tesla (TSLA, +0.8%) managed a win today after the electric vehicle (EV) maker said it delivered a higher-than-expected 241,300 vehicles in the third quarter. In its report, TSLA also noted it produced 237,823 cars in the three-month period, the bulk of which were its mid-range Model 3 and Y offerings. Oppenheimer analyst Colin Rusch weighed in on Tesla after the report, saying he remains "bullish on TSLA shares on its continued strong execution in a challenging environment and clear technology leadership." Rusch has an Outperform (Buy) rating on the stock.
- General Motors (GM, +1.6%) was also in focus today on news impact investment group Engine No. 1 – which made waves earlier this year when it led a successful effort to gain seats on oil major Exxon Mobil's (XOM) board – took a stake in the automaker. Speaking on CNBC's "Squawk Box," the hedge fund's founder Chris James said, "GM, with the support of a really strong management team and a great board, has decided that they're going to embrace the future."
- U.S. crude oil futures jumped 2.3% to $77.62 per barrel, their highest settlement since November 2014. Today's spike came after the Organization of the Petroleum Exporting Countries (OPEC) and its allies chose to stand pat on its current plan to gradually increase crude oil production by 400,000 barrels a day in November.
- Gold futures edged up 0.5% to $1,767.60 an ounce.
- The CBOE Volatility Index (VIX) surged 8.6% to 22.96.
- Bitcoin prices rose 2.8% to $49,399.90. (Bitcoin trades 24 hours a day; prices reported here are as of 4 p.m. each trading day.)
Worried About Volatility? Read On.
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