U.S. stocks plunged on Thursday, led by a steep drop in technology stocks that wiped out the gains in the banking sector.
In the cash market, the blue chip Dow Jones Industrial Average closed at 21287.03, down 167.58 or -078%. The benchmark S&P 500 Index settled at 2419.70, down 20.99 or -0.86% and the technology-based NASDAQ Composite closed at 6145.97, down 88.44 or -1.42%.
The Dow, which at one point was down 250 points, was driven lower by weakness in Apple, Boeing and 3M. Information technology pressured the S&P 500 Index.
The NASDAQ Composite was driven sharply lower by a more than 1 percent drop in shares of Facebook, Amazon, Netflix, Apple and Google-parent Alphabet.
The steep drop in technology stocks erased the gains from the big banks, which followed the Federal Reserve not objecting to the capital repurchase programs from the banks they examined.
In other news, the CBOE Volatility Index (VIX), widely considered the best gauge of fear in the market, jumped 14.1 percent to trade near 11.44.
Economic News
In U.S. economic news, according to the Commerce Department, the U.S. economy grew at an annualized rate of 1.4 percent in the first quarter. This final first-quarter GDP read was slightly higher than the 1.2 percent forecast.
Weekly jobless claims came in at 244,000 for the week-ending June 23, slightly above the expected 240,000 estimate.
Crude Oil
Oil futures gave back most of its earlier gains but still managed to close higher for the sixth straight session.
A combination of profit-taking and short-covering has been behind the lengthy rally. The market received a boost on Wednesday after the U.S. government reported a decline in weekly U.S. production. The news carried over into Thursday’s session. This helped alleviate a few of the lingering concerns over the global supply glut.
A weaker U.S. Dollar also helped boost dollar-denominated crude because of increased foreign demand, however, the primary driver of the bullish price action was the Energy Information Administration’s report from Wednesday that showed domestic crude production dropped by 100,000 barrels per day (bpd) to 9.3 million bpd the week-ending June 23, the steepest weekly fall since July 2016.
Gold
August Comex Gold futures retreated on Thursday as investors reacted to hawkish comments from several central banks. Despite the lower close, the market was rangebound for most of the session as gold investors find themselves trapped between the weaker U.S. Dollar and rising Treasury yields.