Nasdaq Correction Triggers Dow Futures Selloff: Down Over 600 Points
U.S. stock futures dropped early Monday following a turbulent week for Wall Street, during which the Nasdaq Composite entered correction territory.
Dow Jones Industrial Average futures fell by approximately 600 points, or 1.5%. S&P 500 futures and Nasdaq-100 futures dipped 2.8% and 4.9%, respectively.
Wall Street experienced a tough week for the major averages. On Friday, the Nasdaq marked its third consecutive week of losses, pushing the tech-heavy index down more than 10% from its record high set last month.
The S&P 500 also posted its third straight losing week, declining 2% over the week. Even the Dow Jones Industrial Average, which had been outperforming, ended a four-week winning streak, falling 2%. In Asia, Japanese stocks confirmed a bear market as Asia-Pacific markets continued last week’s sell-off.
The Nikkei’s 12.4% loss, closing at 31,458.42, was the worst day for the index since “Black Monday” in 1987. The loss of 4,451.28 points was the largest in terms of points in its history.
U.S. Treasury yields tumbled as well. On Friday, the benchmark 10-year note yielded 3.79%, down from 4.20% the previous week.
The recent pullback in stocks was exacerbated on Friday when a disappointing jobs report heightened investor fears that the Federal Reserve erred last week by keeping interest rates unchanged, suggesting the economy may be heading toward a recession.
Investors will now watch to see if this downward trend continues. The S&P 500 is currently 5.7% below its all-time high, and the Dow is down by 3.9%.
“I think we’re in a corrective period, but we still believe the bull market trend is intact,” Keith Lerner, co-chief investment officer at Truist Wealth, told CNBC’s “Closing Bell” on Friday. “It’s just going to take some time to navigate through this choppier period.”
Apple will also be closely watched when the market opens Monday after Warren Buffett’s Berkshire Hathaway sold nearly half of its stake in the iPhone maker.
Economic data due out Monday includes the July ISM Services PMI, which is expected to show a rise to 50.9, up from 48.8 previously.
Investors may gain insights into the Federal Reserve’s future interest rate decisions in the coming week. San Francisco Fed President Mary Daly is scheduled to speak at the Hawaii Executive Collaborative after the market close on Monday.