Stocks tumble as tech and energy dip in late-day selloff

Initial jobless claims held at 884,000

U.S. equity markets reversed course, giving up earlier gains, to end the session lower as investors reviewed disappointing jobless claims data and continued to hedge mega-cap technology names.

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TickerSecurityLastChangeChange %
I:COMPNASDAQ COMPOSITE INDEX13197.179496+198.68+1.53%
NFLXNETFLIX INC.501.77+3.79+0.76%
TSLATESLA INC.844.55+18.39+2.23%

The Nasdaq Composite led the selling, closing down about 2%, with Netflix among the weaker performers.

Tesla, however, bucked the downtrend with shares continuing to recover after an 11% jump on Wednesday. They fell 21% on Tuesday.

TickerSecurityLastChangeChange %
I:DJIDOW JONES AVERAGES30930.52+116.26+0.38%
AAPLAPPLE INC.127.83+0.69+0.54%
MSFTMICROSOFT CORP.216.44+3.79+1.78%

The Dow Jones Industrial Average dropped 400 points, or 1.4%, with Apple and Microsoft among the biggest weights. Financials joined tech as the biggest laggards in the S&P, which ended down 1.76%.

TickerSecurityLastChangeChange %
SP500S&P 5003798.91+30.66+0.81%
XLFFINANCIAL SELECT SECTOR SPDR ETF31.03+0.11+0.36%
XLEENERGY SELECT SECTOR SPDR ETF43.62+0.88+2.06%
XSWSPDR SERIES TRUST S&P COMPUTER SOFTWARE ETF158.91+2.03+1.29%

Looking at the economy, initial jobless claims for the week ended Sept. 5 totaled 884,000, unchanged from the prior week. Continuing claims, a broader category that measures unemployed workers receiving benefits for longer than a week, climbed to 13.385 million, up from a revised 13.292 million. Both numbers were worse than the Refinitiv consensus.

Looking at stocks, tech giants Alphabet Inc. and Amazon Inc., gave up earlier gains to end lower.

TickerSecurityLastChangeChange %
GOOGLALPHABET INC.1,784.47+56.85+3.29%
AMZNAMAZON.COM INC.3,120.76+16.51+0.53%

Nikola Corp. was under pressure after Hindenburg Research accused the electric-truck maker of being “an intricate fraud built on dozens of lies.” The research firm said it established a short position in Nikola shares following its research. This follows the company's deal with General Motors.

SHORT-SELLER ACCUSES GM-BACKED NIKOLA MOTORS OF BEING 'INTRICATE FRAUD'

TickerSecurityLastChangeChange %
NKLANIKOLA CORPORATION20.29+0.55+2.79%
GMGENERAL MOTORS COMPANY54.84+4.87+9.75%

Elsewhere, Citigroup CEO Michael Corbat will retire in February 2021, and will be replaced by Jane Fraser, president and chief executive of global consumer banking. Fraser will become the first woman to head a major financial institution in the U.S.

Meanwhile, drugmaker AstraZeneca plc will know by the end of the year if its late-stage trial of an experimental COVID-19 vaccine will restart. The trial was put on hold this week after a participant fell ill.

TickerSecurityLastChangeChange %
CCITIGROUP INC.63.69-0.54-0.84%
AZNASTRAZENECA PLC52.57+1.23+2.40%

Looking at earnings, video game retailer GameStop reported a wider-than-expected quarterly loss as comparable-store sales fell 12.7% from a year ago. The company said store closings due to COVID-19 and being in the final months of a generation console cycle contributed to the weakness.

Peloton Interactive Inc. shares fell ahead of the release of its quarterly results.

TickerSecurityLastChangeChange %
GMEGAMESTOP CORP39.36+3.86+10.87%
PTONPELOTON INTERACTIVE150.14-7.67-4.86%

Looking at commodities, West Texas Intermediate crude oil slid 75 cents to $37.30 per barrel and gold edged up $9.50 to $1,954.20 an ounce.

U.S. Treasurys were little changed with the 10-year note yield holding around 0.684%.

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In Europe, France’s CAC slid 0.38% and Germany’s DAX lost 0.21% after the European Central Bank kept rates and its stimulus program unchanged despite the euro over the last four months having strengthened 9% versus the U.S. dollar. Elsewhere in the region, Britain’s FTSE slipped 0.16%.

Asian markets ended mixed with Japan’s Nikkei adding 0.88% while China’s Shanghai Composite and Hong Kong’s Hang Seng fell 0.61% and 0.64%, respectively.