(Reuters) – The Nasdaq Composite index fell 2.2% on Friday, putting it on track to confirm it is in a correction following concerns about pricey Big Tech valuations and a cooling economy.
Hit by softer-than-expected job reports and disappointing forecasts from Amazon and Intel, the Nadsaq’s latest decline leaves it down 10.2% from its record high close of 18,647.45 points on July 10.
The Nasdaq 100 index was also on track to confirm a correction territory from its all-time closing high of 20,675.38 points.
An index or stock is widely considered to be in a correction, signaling investor pessimism, when it closes 10% or more below its previous record closing high.
The Nasdaq’s recent selloff comes on the back of investors selling Wall Street’s heavyweight stocks after lackluster results from Tesla and Alphabet compounded investor worries about stretched valuations and concerns that a rally fueled by optimism about the AI technology may have become overextended.
Nvidia, Microsoft and other Big Tech stocks have been key drivers of Wall Street’s rise to record highs in 2024, lifted by expectations of interest-rate cuts this year by the U.S. Federal Reserve and the euphoria around AI.
(Reporting by Ankika Biswas in Bengaluru; Editing by Toby Chopra and Shinjini Ganguli)
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