Stock Market This Week (US): Why Did Nasdaq Fall 6% This Week?

Stock Market This Week (US): Why Did Nasdaq Fall 6% This Week?
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All three major indices suffered their fourth losing week in five weeks. This week, the Dow Jones Industrial Average fell 4.1%, the S&P 500 fell 4.8%, and the Nasdaq Composite fell 5.5%.

US Stock Market This Week: Stock Market Movements

The US market started the week on Monday on a high as investors awaited inflation data later in the week. Most indices ended nearly 1% higher. Crude oil prices edged higher as Brent crude oil advanced 1.4% to $94.13 per barrel.

On Tuesday, the US stock market fell sharply after the August inflation report was published, hurting investors' optimism for cooling prices and a less aggressive Federal Reserve. The tech sector was the hardest hit, with the NASDAQ falling more than 5%.

The US equity market recovered from the previous day's loss on Wednesday. Material stocks were the most hit. It was a volatile day for investors as most stocks bounced in the final minutes of trading.

US stocks had a choppy day on Thursday as investors mulled over several economic reports that showed that the US economy is not in good shape. Initial jobless claims were better than expected, and retail sales also beat expectations.

On Friday, US stocks continued to fall as the market reported its worst week for the S&P 500 and Nasdaq since June. Shares of FedEx plunged 21.4%, their worst daily drop ever after the shipments company withdrew its full-year guidance.

US Stock Market This Week: Key Highlights

Inflation data: The consumer price index (CPI) unexpectedly rose month over month in August even as gas prices eased. The index gained 0.1% for the month and was up 8.3% year over year. The core CPI, which strips out volatile food and energy costs, rose 0.6% from July and 6.3% year over year.

Goldman Sachs on yield: The benchmark 10-year yield was lower at 3.44%. The 2-year yield was at 3.85%, after rising above 3.9% earlier on Friday. Goldman Sachs rate strategists expect the US 10-year yield to peak at 4% by the end of 2023, and the 2-year at 4.3% by the second quarter.

Unemployment Claims in August: According to data from the Department of Labor, initial unemployment claims fell slightly to 213,000, continuing a trend of falling unemployment claim volume that began last month. The week saw a decrease of about 5,000 from the prior week, bringing national claims down to the lowest level since late May. Claims are down about 41% from 363,000 a year ago.

Retail sales: Consumer spending in the US held up last month with retail sales rising 0.3%. Economists were expecting sales to be flat for August. However, retail sales for July were revised lower from flat to a 0.4% drop.

  • How has the US market performed this week?

  • Why did Netflix rise this week?

  • In the US market, which was the best performing industry this week?

  • Which were the worst sectors for the US market this week?

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