Dow Drops 600+ Points, Tech Sector Leads Losses

Home » Money Management » Economic News » Dow Drops 600+ Points, Tech Sector Leads Losses

Dow Drops 600+ Points, Tech Sector Leads Losses

Just under a week ago the markets saw sharp increases after midterms elections resulted in a split congress. However other news has dampened that party, leading the Dow Jones Industrial Average to lose as much as 600 points during today’s trading session. While there are many factors fueling the sell-off, commonly cited culprits include Apple, the rising dollar, and — if you’re the President — the Democrats.

Starting with the lattermost option, today President Trump took to Twitter to blame the market woes on his opposing party. The President wrote, “The prospect of Presidential Harassment by the Dems is causing the Stock Market big headaches!” Trump is likely referring to reports that, with the House of Representatives soon to be under their control, Dems are expected to start utilizing that government body’s subpoena power to probe the administration on numerous fronts. However, as CNN Business notes, it’s unclear that the president’s assertions are accurate considering comparable history (as far as there is any) as well as the fact that the market reacted positively to the promise of government gridlock that solidified itself last week.

In terms of companies, Apple was a notable loser this morning, shedding nearly 5% to reach a 90-day low. This dive comes as Lumentum — a supplier used by Apple to create its iPhones — lowered their sales forecast. Additionally JP Morgan Chase downgraded Apple’s stock. This seemed to have an effect on other tech companies, with Amazon and Tesla down 4.5% and 5.5% respectively at press time.

Zooming out for a moment, another likely factor in the current market slump is the strength of the U.S. dollar. Although having a strong currency would seem like a good thing, the problem is that a rising dollar can be unfavorable to American companies who do business abroad. CNN Business notes that the dollar has hit a 16-month high, partially due to fears in Europe in regards to the increasingly messy Brexit situation.

As of this writing, the Dow is currently down more than 2.3% for the day while the NASDAQ has fallen 2.75%. While it’s always worth looking at the reasons behind these day to day point swings, it’s also important to look at the larger picture. For example, some of the challenges the market faces today are actually due to a strong economy — one that’s recently posted continued jobs gains, wage growth, and GDP growth, in fact. To that point, panic may be premature as markets have grown more volatile in recent months. That said, we’ll see what tomorrow brings.

Comments

Leave a Reply Cancel reply

Your email address will not be published. Required fields are marked *

Author

Jonathan Dyer

I'm a small town guy living in Los Angeles looking to make solid financial decisions. I write for a number of finance websites, including HuffingtonPost and Business2Community. I founded DyerNews.com in 2015 to focus on personal finance and the emerging FinTech markets.

Other Articles by Jonathan Dyer

Robinhood Gets Into Banking with Checking and Savings Product

The free investment app Robinhood made a splash earlier this year when it announced it would allow users (in certain states) to trade cryptocurrencies on the platform. Now the FinTech is making big news again, but this time with fiat currency. Today, the company announced Robinhood Checking & Savings and...

Small Business Sentiment Slides on Economic Uncertainty

For the past two years, small business optimism has remained at historic highs. While that was still the case in November, the National Federation of Independent Business's Small Business Optimism Index did see a slide, reaching a seven-month low. Although the 2.6 point decline wasn't massive by any means, as...

U.S. Consumers Added $16 Billion to Their Credit Card Debt in Q3 2018

While the 2018 holiday shopping season only began a couple of weeks ago, it looks like Americans have already been racking up debt well before the Black Friday kick off. According to a new report by WalletHub, consumers added $16 billion to the total credit debt between June and October...