”There’s really very little to justify (these big stocks’ upward move) other than euphoria,” said Mark Hackett, chief of investment research at Nationwide.
Hackett noted the market has “embedded very optimistic assumptions” about the virus’s impact on the economy, as well as on prospects for Congress and the White House coming up with another economic relief package.
The Dow Jones Industrial Average fell 874 points, or 3%, to 28,227. It was briefly down 1,000 points earlier.
Technology stocks, which account for a significant chunk of the U.S. stock market’s value these days, fell broadly. Apple dropped 7.1%, Amazon lost 5.5% and Facebook gave back 5.1%.
Semiconductor stocks also fell sharply. Nvidia, Qorvo and Advanced Micro Devices fell 8% or more. Even with Thursday’s drop Nvidia is still the biggest gainer in the S&P 500 so far this year.
The stocks that were doing better than the rest of the market were companies whose stocks have been beaten down this year: travel companies and airlines. Carnival Corp was up 6%, Norwegian Cruise Lines was up 5% and Royal Caribbean was up 3%.
Investors were also taking into account the latest economic figures.
The government reported that the number of Americans who applied for unemployment benefits fell last week to 881,000, slightly better than what economists had expected. But that said, companies are still letting workers go at numbers well above those seen in the Great Recession, meaning the jobs picture remains still extremely bleak despite recent improvements.