US investors triggered a major sell-off on Wall Street on Thursday set off by fears that the job market is cooling, manufacturing is slowing and the Federal Reserve has left cutting interests too late to head off a recession.
The Dow Jones fell nearly 500 points (1.2%), while the S&P 500 was also down 1.3%. A series of disappointing results from tech companies have led to sell-offs in big tech.
After a rally on Wednesday following Meta’s second-quarter earnings results, which were better than expected, the tech-heavy Nasdaq’s index was down 2.3%. The bad news continued after markets closed with Intel announcing 15,000 layoffs and Amazon releasing disappointing results.
Two economic data points released on Thursday appeared to spook investors. One measurement of manufacturing activity by the Institute for Supply Management (ISM) hit an eight-month low in July, while the number of Americans filing new applications for unemployment benefits hit an 11-month high last week, according to data released on Thursday.
“The ISM is really what started the ball rolling today and then selling causes more selling,” said Tim Ghriskey, senior portfolio strategist at Ingalls & Snyder in New York.
“We’re still in earnings season and there will be positive surprises that will probably drive the market higher and there may be negative surprises as well … but if you get something negative like ISM, it causes profit-taking.”
Despite Thursday’s stock sell-off, the stock market has…
