U.S. Stocks Showing Another Significant Move To The Downside

(RTTNews) - Following the sell-off seen to close out the previous session, stocks have shown another significant move to the downside during trading on Monday. The major averages have all moved notably lower, with the Nasdaq and the S&P 500 hitting three-month lows.

Currently, the major averages are off their lows of the session but still firmly negative. The Nasdaq is down 454.42 points or 2.7 percent at 16,321.75, the S&P 500 is down 133.64 points or 2.5 percent at 5,212.92 and the Dow is down 953.28 points or 2.4 percent at 38,783.98.

The continued weakness on Wall Street comes on the heels of an overseas sell-off, which saw Japan's Nikkei 225 Index record its biggest slump since "Black Monday" in October 1987.

Concerns about the U.S. economy slipping into recession following last Friday's disappointing jobs report triggered the significant weakness in the overseas markets.

Shares of AI darling and market leader Nvidia (NVDA) are plunging 7.2 amid an unwinding of the artificial intelligence trade that recently helped the markets to record highs.

Tech giant Apple (AAPL) is has also tumbled by 4.6 percent after Warren Buffett's Berkshire Hathaway revealed it sold nearly half its stake in the iPhone maker.

Stocks regained some ground following the release of a report from the Institute for Supply Management showing service sector activity in the U.S. turned positive in the month of July.

The ISM said its services PMI climbed to 51.4 in July from 48.8 in June, with a reading above 50 indicating growth. Economists had expected the index to rise to 51.0.

"The uptick in the ISM services index will do little to reverse market jitters of a recession in the wake of Friday's employment report, but it aligns with our view of an economy in transition rather than one on the brink of collapse," said Matthew Martin, U.S. Economist at Oxford Economics.

He added, "Expectations for aggressive rate cuts in September are overdone, and we expect the Fed to move forward with a 25bps cut at the meeting."

Sector News

Computer hardware stocks are turning in some of the market's worst performances on the day, resulting in a 4.5 percent nosedive by the NYSE Arca Computer Hardware Index.

Considerable weakness is also visible among airline stocks, as reflected by the 4.4 percent plunge by the NYSE Arca Airline Index.

Semiconductor stocks have shown a significant move to the downside on the day, with the Philadelphia Semiconductor Index slumping by 1.8 percent to a three-month intraday low.

Most of the other major sectors have also moved lower amid continued broad based selling pressure on Wall Street.

Other Markets

In overseas trading, stock markets across the Asia-Pacific region moved sharply lower during trading on Monday. Japan's Nikkei 225 Index saw a 12.4 percent nosedive, while South Korea's Kospi plunged by 8.8 percent.

The major European markets have also shown significant moves to the downside. While the French CAC 40 Index is down by 1.6 percent, the U.K.'s FTSE 100 Index and the German DAX Index are both down by 2.1 percent.

In the bond market, treasuries are seeing continued strength due to their appeal as a safe haven. As a result, the yield on the benchmark ten-year note, which moves opposite of its price, is down by 2.9 basis points at 3.765 percent.