The downturn adds more pressure on investors who are anticipating that the Federal Reserve will slash interest rates
The Dow Jones Industrial Average tumbled more than 400 points on Friday, extending its decline as a weaker-than-expected August jobs report added to the ongoing selloff in AI and tech stocks. The latest drop adds further pressure on market that has already had a rough start to September.
The U.S. economy added just 142,000 nonfarm payrolls in August, according to data from the Bureau of Labor Statistics—well below the 160,000 jobs economists had anticipated. Meanwhile, the unemployment rate held steady at 4.2%, aligning with consensus expectations.
The mixed data came as investors are hoping that the Federal Reserve will cut interest rates this month.
The Dow lost 406 points in the afternoon, or 1%, falling to 40,348. The tech-heavy Nasdaq $NDAQ dropped over 2.4%, while the S&P 500 shed 1.6%.
Broadcom $AVGO reported $13 billion in revenue for the third quarter, bringing in an adjusted $1.24 a share, narrowly beating analysts’ expectations.
The Palo Alto, California-based company said Thursday that it expects sales of approximately $14 billion for the fourth quarter, following below the $14.09 billion expected by analysts, according to data compiled by FactSet.
Broadcom stock fell 9% to $138 per share on Friday.
Major tech stocks dived as investors offloaded riskier assets, driven by growing concerns over the U.S. economy’s health. Amazon $AMZN and Google $GOOGL parent Alphabet each declined by more than 3%, while Facebook $META parent Meta saw a drop of over 2.5%. Tesla $TSLA stock faced an even steeper decline, shedding more 6%.
The broader tech sector wasn’t spared either, with semiconductor stocks continuing their downward slide. Nvidia $NVDA and Advanced Micro Devices both dropped 4.8%, while Super Micro Computer saw a 6.5% loss. The declines reflect heightened uncertainty in the market as investors brace for potential economic headwinds.
–Rocio Fabbro contributed to the article
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