U.S. stocks closed lower on Thursday, with the Nasdaq Composite dropping approximately 1.5% amid a sell-off in technology shares. The index fell to 25,881.95, reflecting a broader decline in investor sentiment, as indicated by the CNN Money Fear and Greed index, which shifted to the 'Fear' zone with a reading of 41.8, down from 47.9 the previous day.
Key Details
The decline in the Nasdaq was driven by weakness in communication services and information technology sectors. The Dow Jones Industrial Average also fell, closing down around 106 points at 52,552.97. The S&P 500 index decreased by 0.51% to finish at 7,533.77. In contrast, sectors such as consumer staples, health care, and real estate showed resilience, recording gains during the session.
Background
On the economic front, U.S. retail sales rose by 0.2% month-over-month in June, aligning with market expectations but down from a revised 1% increase in May. Additionally, initial jobless claims decreased by 8,000 to 208,000 for the week ending July 11, compared to estimates of 217,000.
The decline in the Nasdaq and overall market sentiment could lead to increased volatility in tech stocks, which are particularly sensitive to shifts in investor confidence. A continued trend towards fear may pressure stock prices, especially in growth-oriented sectors.
Investors will watch for upcoming economic data releases, particularly retail sales and jobless claims, to gauge the strength of the U.S. economy and its impact on market sentiment.