The Nasdaq experienced a steep selloff
The major benchmarks started the year on a high note, with bank and tech sectors leading the charge. And though the Dow Jones Industrial Average (DJI) and S&P 500 (SPX) nabbed fresh all-time highs the following day, with the former landing a record close, the Nasdaq Composite (IXIC) began what would be a steep two-day selloff. Wednesday, the highly anticipated Federal Reserve meeting minutes were released, indicating plans for an aggressive pullback in bond holdings and general policy aid before the summer, and the broader market suffered a sharp drop, with the Nasdaq losing over 522 points.
Investors were still unpacking the Fed decision on Thursday, along with better-than-expected weekly jobless claims data, and all three benchmarks finished the day lower. At this point on Friday, all the major indexes are on track for weekly losses, as disappointing payrolls data weighs, though better-than-expected unemployment numbers are helping lessen the blow. Plus, the Nasdaq is once again down triple-digits.
Tech, Chip Stocks in Spotlight
Both tech and semiconductor stocks were particularly harsh on the Nasdaq this week, but there were still some upbeat stories. Apple (AAPL) made waves right off the bat, after it became the first U.S. company to exceed the $3 trillion market cap. In other FAANG news, Datadog's (DDOG) is partnering with Amazon.com's (AMZN) Amazon Web Services (AWS). Elsewhere, two chip stocks, NXP Semiconductors (NXPI) and Qualcomm (QCOM), pulled back to historically bullish trendlines.
Blue-Chip Stocks Making Moves
A few Dow members also made headlines. Walgreens Boots Alliance Inc (WBA) was weighed down by the broader market despite an upbeat fiscal first-quarter report, as demand for Covid-19 vaccinations and testing continues. Meanwhile, Vuzix (Vuzi) announced a partnership with Verizon (VZ), and Mizuho downgraded Visa (V). Plus, options traders targeted Coca-Cola (KO) after the soda giant jumped to record highs.
Busy Week Ahead
Expect plenty of quarterly reports from financial names next week, including BlackRock (BLK) and JPMorgan Chase (JPM). There is plenty of economic data due out as well, with a federal budget update slated for release on Wednesday, alongside the latest from the U.S. Federal Reserve's Beige Book. Meanwhile, see how presidential cycles may cause seasonal underperformance for the S&P 500, according to Schaeffer's Senior Quantitative Analyst Rocky White.