Nasdaq plunges as investors abandon Big Tech

STORY: The Nasdaq ended sharply lower on Thursday after a series of record closes as investors moved out of Big Tech stocks and into smaller company stocks.

The Dow Jones rose marginally. The S&P 500 fell, losing about nine-tenths of one percent, and the tech-heavy Nasdaq fell about 2%.

A Labor Department report showed that U.S. consumer prices unexpectedly fell in June, and the annual increase was the smallest in a year, bringing the Federal Reserve closer to a rate cut in September.

Despite signs of retreating inflation, Wall Street’s most valuable companies lost ground, with Microsoft and Amazon each losing more than 2%, Meta Platforms falling around 4% and AI chip darling Nvidia falling 5%. .5%.

F/m Investments CEO Alexander Morris said it is time for market gains to expand beyond Big Tech.

“We needed that capital to go beyond 7 or 10 companies in the market. In the long term, that wouldn’t be a healthy thing. We knew there would be a catalyst for that. We thought rates would come down, and we saw that when there was news that it was quite Of course rates would fall soon, the market reacted more or less as we expected.”

Tesla shares fell 8.4%, the biggest daily percentage drop since January, after Bloomberg News reported that the company is delaying the launch of its robotaxi by about two months to October.

Apple shares fell 2.3% after hitting a record high on Wednesday. Still, BofA Global Markets raised its price target for Apple, saying it expects strong iPhone sales driven in part by new AI features.

On the other hand, the small-cap Russell 2000, which significantly lagged the S&P 500 in 2024, jumped 3.6% to close at its highest level since March 2022, as investors bet that rate cuts would improve conditions for smaller companies.