Wall Street declined on Thursday as leading technology stocks lost value, influencing the broader market’s performance. The losses affected major indexes, with the S&P 500 dropping 1.1% to 6,720.32, the Dow Jones Industrial Average falling 0.8% to 46,912.30, and the Nasdaq composite decreasing by 1.9% to 23,053.99.
Among the largest contributors to the decline were Nvidia, which fell by 3.7%, Microsoft by 2%, and Amazon by 2.9%. These companies’ significant market values mean their share price movements have a large impact on overall market direction.
Investors focused on corporate earnings and forecasts amid limited economic data due to an ongoing U.S. government shutdown—the longest in history—which has prevented updates on inflation, employment, and retail sales figures.
DoorDash experienced one of the steepest declines among individual stocks, falling 17.5% after announcing increased spending plans for product development next year. CarMax shares dropped by 24.3% following a disappointing financial update and news that CEO Bill Nash will step down in December.
Some companies posted gains despite broader declines: Datadog rose by 23.1% after surpassing earnings expectations, while Rockwell Automation gained 2.7%.
Major stock indexes have had a volatile week after reaching record highs last week during what has been a strong year for markets overall—a trend that has led some analysts to worry about potential overvaluation, particularly among large technology firms benefiting from interest in artificial intelligence.
With federal economic data unavailable because of the shutdown—including monthly employment numbers for September and likely October—Wall Street is increasingly relying on private sources for information about economic conditions.
Private payrolls exceeded expectations in October according to ADP’s report released Wednesday; meanwhile, Institute for Supply Management data indicated growth in the services sector during October.
A report from Challenger, Gray & Christmas showed that job cuts surged by 175% in October compared to a year earlier, driven by weaker consumer and business spending, higher costs, and growing use of artificial intelligence technologies.
The lack of official updates on jobs and inflation presents challenges for the Federal Reserve as it considers monetary policy decisions amid signs of weakening employment alongside rising inflation risks.
“We anticipate the Fed will continue to implement rate cuts to prevent any weakness in employment from accelerating,” said Seema Shah, chief global strategist at Principal Asset Management. “Much of the market’s optimism hinges on the assumption that policymakers will maintain some level of support.”
The Federal Reserve has already reduced its benchmark interest rate twice this year but signaled caution moving forward as it weighs risks facing the economy. Market expectations now suggest a lower probability—71%, down from over 90% before recent actions—that another rate cut will come in December according to CME FedWatch data.
The government shutdown is also affecting airlines directly; staffing shortages at airports are prompting the Federal Aviation Administration to reduce air traffic by 10% starting Friday across forty high-volume markets nationwide—a move impacting American Airlines (down 2%), Delta Air Lines (down 1.2%), and United Airlines (down 1%).
European stock markets fell following news that a divided Bank of England kept its main interest rate unchanged while Asian markets closed higher.
