US stocks started the holiday-shortened week on a sharply lower note, with the massive sell-off in tech stocks continuing. On Tuesday, the Nasdaq Composite index entered correction territory at the fastest speed in its history, plunging 10% over the previous three trading sessions.
Although the number of jobless claims remained below the 1 million mark, the latest reading came in higher than what analysts were expecting. Investors also digested news of AstraZeneca pausing the late-stage trials for its covid-19 vaccine candidate. Although a continuous decline in daily infections provided some relief to investors, it wasn’t enough the halt the ongoing correction in tech stocks.
Performance of US Indices
US stocks ended modestly higher on Friday, but still closed the volatile week sharply lower. The week also saw the Nasdaq recording its biggest weekly loss since March 20 as investors responded to various analyst reports saying tech stocks were grossly overvalued. Meanwhile, the US Treasury Department announced that the federal budget deficit exceeded $3 trillion in August.
The Dow Jones Industrial Average gained 131.06 points to close at 27,665.64 on Friday. The 30-stock index shed 1.7% last week, following a 1.8% drop in the prior week. The S&P 500 index declined 2.5% during the week, while the Nasdaq fell by 4.1%.
Top US Stocks of the Week
Shares of Nikola Corporation (NASDAQ: NKLA) spiked more than 40% on Tuesday after the company announced a strategic partnership with General Motors. Despite the rally, Nikola’s stock closed the week lower by around 11%.
General Motors Company’s (NYSE: GM) shares rose 8% on Tuesday following news of its partnership with Nikola. GM’s stock gained over 3% during the week.
Tesla, Inc’s (NASDAQ: TSLA) shares plummeted more than 21% on Tuesday, recording its biggest single-day downturn in its history, after the S&P 500 index declined from including the stock. Tesla’s shares lost about 8% last week.
Shares of Slack Technologies, Inc. (NYSE: WORK) slid 14% on Wednesday despite the company reporting strong results for the second quarter. Investors were disappointed, however, by the company’s billing figures. The stock recorded a decline of about 17% for the week.
Tiffany & Co’s (NYSE: TIF) shares dropped over 6% on Wednesday after LVMH said it wouldn’t be able to complete its merger deal with Tiffany. The stock lost around 7% last week.
On Thursday, Restoration Hardware Holdings, Inc’s (NYSE: RH) shares climbed 20% after the company reported better-than-expected Q2 results. The stock ended the week higher by around 19%.
Shares of GameStop Corp. (NYSE: GME) fell 15% on Thursday after the company posted a wider-than-expected Q2 loss. The shares lost more than 20% last week.
Performance of European Indices
European stocks closed mixed on Friday as the European Central Bank kept interest rates unchanged at its latest meeting. However, the bank issued a positive outlook for the economy, lifting GDP estimates for the year. UK GDP expanded 6.6% in July, while German consumer prices declined in line with estimates, falling 0.1% in August.
The Stoxx Europe 600 Index closed the week higher by 1.7%, after rising slightly more than 0.1% on Friday. The FTSE 100 index rose 0.5% on Friday, closing the week higher by 4%. The French CAC 40 gained 1.3%, while the German DAX 30 index gained 2.8% last week.
Top European Stocks of the Week
Shares of Scor gained around 11% on Wednesday after the French company announced a new strategic plan.
Games Workshop’s shares jumped around 12% on Thursday after the company announced a strong trading update for the three-month period.
WM Morrison’s stock fell 5% on Thursday after the supermarket chain posted a 25.3% decline in first-half net profits.
Shares of Altice Europe NV jumped more than 24% on Friday after the French company’s founder announced plans to take the company private.
The Forex Market
The British pound delivered its steepest decline versus the euro since March following news of an ECB-driven rally in the euro and a sharp decline in British sentiment due to Brexit negotiations. After trading almost flat on Friday, the GBP/EUR closed the week lower by 3.7%.
The Japanese yen closed a volatile week on a flat note versus the US dollar. Japanese producer prices declined 0.5% in August following a 0.9% decline in July. The USD/JPY pair closed mostly unchanged last week.
The Crypto Market
Last week proved to be a tough one for the Bitcoin, with the digital currency declining more than 8%. Bitcoin tumbled below the $10,000 mark on three successive days.
Bitcoin was trading close to $10,580 over the weekend, while Ethereum traded at $376.