Article by: Tide Research
The Nasdaq plunged 5.52%, entering a technical correction; the S&P 500 and Dow Jones fell 4.36% and 3.44% respectively, erasing all gains since Wednesday’s election.
The combined market value of the "Magnificent Seven" U.S. stocks has declined by over $1 trillion, with NVIDIA leading the decline; the Philadelphia Semiconductor Index fell approximately 12%.
After hours, Airbnb and Cloudflare surged sharply above expectations, while DraftKings and Atlassian plunged.
Nasdaq enters correction, all three major indices record their largest single-day decline in 19 months
On Thursday, the Nasdaq fell 5.52% to close at 24,315.00, entering a technical correction of more than 10% from its recent high.
The S&P 500 fell 4.36% to close at 7,353.73; the Dow Jones Industrial Average dropped 1,833.06 points, or 3.44%, to close at 51,523.06. The Nasdaq 100 declined 6.36% to 26,629.81, and the Russell 2000 fell 4.45% to 2,729.89.
All three major indices posted their largest single-day declines since the tariff shock on April 4, 2025. The VIX rose 11.57 points to 28.18, the highest level since March 31 and the largest single-day gain since April 4, 2025.
All 11 sectors of the S&P 500 closed lower, with Information Technology down 7.30%, its worst performance since March 16, 2020; the technology sector ETF (XLK) fell 8.04%. The ratio of declining to advancing issues on the NYSE approached 6:1.
AI infrastructure stocks led the decline, with the Magnificent Seven losing over $1 trillion.
The market continues to digest the data center regulatory risks following the Democratic sweep of Congress, putting pressure on AI-related stocks.
The combined market value of the "Big Seven" U.S. stocks has declined by over $1 trillion. NVIDIA fell more than 9%, losing over $440 billion in market value, with its year-to-date decline expanding to approximately 2.6%, turning negative; AMD and Micron each dropped about 17%; CoreWeave fell around 10%; GE Vernova declined 7.5%.
The Philadelphia Semiconductor Index fell about 12%, marking the second-largest single-day decline on record. SanDisk dropped approximately 22% during intraday trading.
Apple and Microsoft, which hit all-time highs on Wednesday, also pulled back with the broader market. Trades betting on a divided government boosting stocks were overshadowed in a single day by concerns over AI regulation.
Airbnb and Cloudflare surge after hours; DraftKings drops over 20%
Airbnb's third-quarter revenue was $4.87 billion, a year-over-year increase of approximately 19%, exceeding the expected $4.75 billion; earnings per share were $3.16, above the expected $2.85.
The company raised its full-year revenue growth outlook to "high double digits" and added a $12 billion stock buyback authorization. The stock rose approximately 11% to $188.89 in after-hours trading.
Cloudflare's Q3 revenue was $782.5 million, exceeding expectations; Q4 revenue guidance of $845 million to $846 million surpassed the expected $798 million, driving a post-market rise of approximately 14% to $279.
JFrog raised its full-year guidance and rose about 25% after hours.
DraftKings reported a Q3 loss of $0.94 per share and revenue of $1.3 billion, both below expectations, leading to a post-market decline of approximately 22%. Atlassian fell over 15% after hours due to a downward revision in its data center revenue growth outlook. Affirm’s next-quarter guidance only slightly exceeded expectations, resulting in a post-market drop of about 11%; Axon’s earnings fell short of forecasts, causing a post-market decline of approximately 13%.
Initial jobless claims fell to 189,000, while oil prices rebounded.
Initial jobless claims for the week came in at 189,000, below the expected 197,000 and down by 6,000 from the previous week.
U.S. Treasury yields declined. The 10-year yield fell more than 5 basis points to 4.839%, and the 2-year yield dropped more than 11 basis points to 4.466%.
WTI crude rose 2.7% to a settlement price of $90.52 per barrel; Brent crude rose 3.8% to a settlement price of $98.29 per barrel. Attacks on tankers have reignited supply concerns, after both fell more than 8% on Wednesday.
Bitcoin fell about 6%, retreating to around $75,000.
Today's Focus
All times are in Beijing Time.
21:30: U.S. Non-Farm Payrolls report for October. Dow Jones survey expects an addition of 59,000 jobs, with the unemployment rate holding steady at 4.2%. September saw only 29,000 new jobs added.
The Federal Reserve: CME FedWatch shows that the market is pricing in approximately a 70% chance of a 25-basis-point rate hike on December 9. Following Thursday’s sharp stock market decline, some interest rate traders have pushed their expectations for the next rate hike to March next year.