Is the tech pain over? | Santoli on the textbook correction | Fed in the week ahead
| EDITOR'S NOTE
Wall Street's overdependence on the tech sector made traders pay last week.
The S&P 500 dropped 2.5% for the week and notched its first back-to-back weekly losses since May. The tech-heavy Nasdaq Composite fell more than 4% and the Dow Jones Industrial Average lost 1.7%. It was the S&P 500's worst week since June and the Nasdaq's biggest weekly drop since March.
Tech — which has been the market stalwart this year amid the coronavirus pandemic — plunged 4.4% last week amid concerns over the sector's sky-high valuations. Apple and Tesla lost 7.4% and 10.9%, respectively. Facebook, Amazon, Netflix, Alphabet and Microsoft were also sharply lower in that time.
"It is difficult to know how much further this process has to run, but our guess is that a capitulation point has not yet been reached," Peter Berezin, chief global strategist at BCA Research, said in a note to clients. "This suggests that the correction is not yet over."
Investors will turn their attention to the Federal Reserve next week as the central bank holds its final policy meeting before the U.S. election. While the Fed is expected to strike a dovish note, it may not give market participants the policy details they want to hear, writes CNBC's Patti Domm.
Wall Street will also keep an eye out for the latest U.S. retail sales data, which is scheduled to be released Wednesday.
MICHAEL SANTOLI'S MARKET COLUMN
YOUR WEEKEND BRIEFING
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