Stocks showed a significant move to the downside during trading on Tuesday, extending the pullback seen over the course of the two previous sessions. The major averages all showed substantial moves into negative territory.
The major averages remained firmly negative throughout the session before closing firmly in the red. The Dow tumbled 632.42 points or 2.3 percent to 27,500.89, the Nasdaq plunged 465.44 points or 4.1 percent to 10,847.69 and the S&P 500 slumped 95.12 points or 2.8 percent to 3,331.84.
The weakness on Wall Street came as traders continued to cash in on recent strength in the markets, with the Nasdaq and the S&P 500 pulling back further off record highs.
Technology stocks helped to lead the way lower once again, as Facebook (FB), Amazon (AMZN), Microsoft (MSFT) and Apple (AAPL) all posted steep losses on the day.
While tech stocks have helped to lead the markets off their March lows, traders seem to feel that the recovery has been overdone.
Substantial weakness was also visible among energy stocks, which moved sharply lower along with the price of crude oil. Crude for October delivery plunged $3.01 to $36.76 a barrel amid concerns about the outlook for demand.
Reflecting the weakness in the energy sector, the Philadelphia Oil Service Index plummeted by 5.8 percent, while the NYSE Arca Natural Gas Index and the NYSE Arca Oil Index tumbled by 4.2 percent and 4.1 percent, respectively.
Semiconductor, software and financial stocks also saw considerable weakness, moving lower along with most of the other major secotrs.
In overseas trading, stock markets across the Asia-Pacific region moved mostly higher during trading on Tuesday. Japan’s Nikkei 225 Index advanced by 0.8 percent, while China’s Shanghai Composite Index climbed by 0.7 percent.
Meanwhile, the major European markets moved to the downside on the day. While the French CAC 40 Index has plunged by 1.6 percent, the German DAX Index slumped by 1 percent and the U.K.’s FTSE 100 Index edged down by 0.1 percent.
In the bond market, treasuries moved higher following the sharp pullback seen in the previous session. Subsequently, the yield on the benchmark ten-year note, which moves opposite of its price, fell by 3.7 basis points to 0.684 percent.
Looking ahead, the economic calendar remains quiet on Wednesday ahead of the release of inflation data in the comings days.
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