🔎 What's happening to the stock market today?

The first half of 2024 was a continuation of last year’s bull market, with AI hype largely fueling the year’s early momentum. Through July 16, the S&P 500 was up almost 20%, and the Nasdaq was up over 25%. 

But something shifted in mid-July. 

What first appeared as a seemingly healthy corrective to tech sector hype and a turn toward all-but-forgotten small-cap stocks has become a larger drawdown, and today’s market movement confirmed that.

Since then, these leading indices have noticeably retracted, and the S&P and Nasdaq ended last week down 3.3% and 5.5%, respectively.

On Monday, the downward trend continued.

• U.S. stock indexes continued to fall: The S&P 500 is down approximately 3% on the day, the Nasdaq roughly 4%, and the Dow Jones by about 2.5%.

• The volatility kicked off in Japan, where the Nikkei index began trading on Sunday night U.S. time. By the end of Monday, the Nikkei was down 12%, its worst-ever single-day decline.

• Crypto hasn’t been safe either, with both Bitcoin and Ethereum down about 7.5% and 11%, respectively.

Why is this happening?

Although there is rarely a single, specific reason for any market trend, there are certainly some noteworthy catalysts behind this drop. 

• Murmurings of frustrations with the AI hype on Wall Street have been building for quite some time now, and last week, they reached a tipping point. Investors are growing concerned that big tech’s lavish spending on AI is becoming reckless, and they’re asking where and when that ROI will show itself. 

• Plus, geopolitical turmoil is likely getting to investors, and growing anticipation of a coming interest rate cut may have fueled some apprehension as well. 

• Last week’s July jobs report was disappointing, too, with hiring slowing and unemployment ticking up to its highest level since 2021. 

• Big whales like Warren Buffet’s Berkshire Hathaway shedding $390 million worth of Apple shares didn’t help much either.

Some perspective

• To be clear, there’s no reason to panic when things like this happen. In 2023, the S&P 500 returned over 21%, and the Nasdaq churned out over 40%—and both of these indexes dropped 8.8% and 9.8%, respectively, across four weeks last fall. 

• Consider this: The S&P 500 is down over 8.2% from its peak this year, and it’s still up over 9.5% year-to-date. Historically speaking, that’s still an above-average year. Corrections like this might feel dramatic, but they are ultimately completely normal in the stock market cycle.

How Origin can help 

• Automate your investing for times like these: Market corrections are inevitable, but that doesn’t mean you have to ride a roller coaster of emotion along with them. Origin allows you to select a risk-tolerance level and portfolio allocation, enabling you to “set it and forget it” during chaotic times—yes, we’ll even rebalance for you. 

• Professional support: It’s normal to feel a bit uneasy during tumultuous economic times, but our financial professionals are here to help. As an Origin member, you get easy access to our team of Certified Financial Planners®, who can answer your questions and provide guidance.

Origin is fully customizable to meet the needs of your business and its people. Find out what else Origin can do for you. (opens in new window)