All the major U.S. stock market indices fell sharply on Wednesday, with the Nasdaq officially entering into correction territory.
The Wall Street Journal reported that the technology-heavy Nasdaq Composite Index suffered its worst day in over seven years, dropping approximately 329 points (4.4 percent) to to 7,108.
Similarly the Dow Jones Industrial Average was down more than 600 points (2.4 percent), dropping below 25,000 for the first time since July, and erasing all its gains for 2018.
The S&P 500 also lost all its gains for the year, pulling back 85 points (3 percent) and coming in at 2,656.
According to The Journal, “Worries about global economic growth and corporate earnings have buffeted stocks around the world and commodities this month. Highflying internet and technology shares have been among the hardest hit.
“Investors have flocked toward the technology sector for years because of its ability to consistently lift sales regardless of global economic growth, but recent trade tensions between the U.S. and China and signs that earnings might be peaking have hurt the market’s leaders.”
Market watchers also pointed to rising interest rates as a drag on the stock market.
Netflix was among the stocks hardest hit, declining 9.4 percent, even after it reported a jump in subscribers last week.
Boeing bucked Wednesday’s selloff, rising 1.3 percent, after it reported strong sales for commercial jets and new defense projects.
“It was kind of a market that was looking for a reason to have some money come out of it,” Tony Dwyer, chief market strategist with the brokerage firm Canaccord Genuity, told The New York Times. “And it found it.”
CNBC reported that stocks have taken a beating in October, which has often been the case in years past.
The Dow is off 7.1 percent for the month, while the S&P 500 is down 8.9 percent, and the Nasdaq tumbled 11.7 percent.
On Tuesday, President Donald Trump targeted Federal Reserve Chairman Jerome Powell, arguing rising interest rates are endangering the booming U.S. economy.
“I’m just saying this: I’m very unhappy with the Fed because Obama had zero interest rates,” Trump told The Journal. “Every time we do something great, he raises the interest rates.”
The Feds have raised the benchmark rate three times this year, most recently in September to approximately 2 percent.
The fundamentals of the U.S. economy remain sound, with GDP growth rate expected in the range of 4 percent for the third quarter and the nation experiencing its lowest unemployment rate since 1969.
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