NASDAQ witnesses worst day since 2022; Tech stocks pull index down 3.6%

The NASDAQ fell more than 3.6% on Wednesday, marking its worst day since 2022. The index was pulled lower as tech stocks crumbled under selling pressure. Fears of the tech giants losing steam for further growth triggered a massive sell-off in the index.

The NASDAQ opened Wednesday’s session at 17,733 and hit a high of 17,747 before trending lower. It ended the session down 654.94 points, or 3.64%, bringing the index to its multi-week lows.

At the same time, the Dow Jones Industrial Average fell by 1.25% to end the session at 39,853, while the benchmark index, the S&P 500, saw losses of over 2% for the first time in the month and ended the session at 5,427.

NASDAQ saw a steep fall on Wednesday due to the underwhelming financial results of tech giants Google’s parent company, Alphabet, and Tesla. Investors were left concerned that the bull run fueled by growth in artificial intelligence is fizzling out. As worries rose about weakened growth in the future, shares of several companies, including Amazon, Nvidia, and Microsoft, were deep in the red.

Tesla’s shares plunged over 12.33% and were trading at $215.99. The company saw a significant sell-off as it reported a 7% year-on-year (YoY) decline in total automotive revenues in the second quarter of FY24.

Although Alphabet reported a 15% YoY rise in revenues for Q2, the slowdown in ad revenue and higher capital expenditure triggered a fall of over 5% to $174.37. Microsoft, Apple, Nvidia, Alphabet, Amazon, Meta, and Tesla are termed as the Magnificent 7 stocks in the NASDAQ. Being industry leaders, they hold significant importance in providing guidance for the overall trajectory of the industry.

Following Wednesday’s sell-off the Magnificent 7 lost a collective market cap of over $750 billion.

The NASDAQ has risen nearly 17.5% since the start of the year. The index has seen gains of over 22% in the past year.