Day Traders Diary

9/3/20

A sharp selloff in the major averages are wiping out the gains of the week as major tech stocks give back a lot of thier recent gains. The Dow Jones is on track to drop a 1000 points or 3%. The S&P 500 is down 4% as the Nasdaq which was up 30% for the year is down 5% on the day.

Apple shares fell 7.2%. Amazon and Netflix were both down at least 5% along with Facebook. Microsoft slipped 6.7%. Alphabet pulled back by 5.6%. The S&P 500 tech sector traded 6.3% lower and was on track for its first losing session in 11 trading days. The sector was also on pace to post its biggest one-day loss since March.

Shares of beaten-down companies that would benefit from the economy reopening rose, bucking tech's negative trend. Cruise operator Carnival advanced 6%. Macy's popped 11.8%.

Thursday's moves came after another record-setting session for the S&P 500 and the Nasdaq Composite. That run-up on Wednesday was powered by cyclical stocks, which move in response to the health of the U.S. economy, and added to the market's strong move off the March 23 lows.

Since late March, the S&P 500 is up more than 55% and the Nasdaq has rallied nearly 70%. The Dow has surged more than 50% in that time. To be sure, some analysts think it may be time for the market to consolidate some of its recent sharp gains.