Investors’ initial euphoria gave way to selling as hopes for a December rate cut faded and bitcoin continued to sell off.
What began as a banner day for stocks turned into a major rout, as investors signaled ongoing skepticism about the longevity of the artificial intelligence boom and trimmed hopes of support from the Federal Reserve.
The tech-heavy Nasdaq fell 2%, and the broad S&P 500 index dropped by more than 1.5%. The Dow Jones Industrial Average, which tracks 30 top-tier stocks, declined by nearly 390 points. It had been up 700 points earlier in the day. Cryptocurrencies also shed billions in value: Bitcoin had fallen below $87,000 as of late Thursday afternoon, weeks after having set highs above $120,000.
The stunning turnaround added further unease to an already shaky economy that has forced households to trim budgets amid stubborn inflation and signs of a wavering job market. With an ever-increasing part of the economy’s principal driver — consumer spending — now reliant on affluent households, an extended market pullback could inflict wider damage.
I do the same, but I’m under no illusions this is safe practice. Every time-tested bit of good sense works until it doesn’t.
The best argument for index funds at this point aren’t their stability - it’s that they seem least likely to collapse in the burning cesspit of the modern world economy.
Investing in the least sick looking cow.