Markets in the US and Western Europe saw a sharp selldown on Friday, sending the Nasdaq into correction territory following a weaker-than-expected US jobs report. That just added momentum to a selloff of Big Tech shares as traders worry about the commercial viability of artificial intelligence.

The Nasdaq is now down more than 10% since 11 July after losing 2.4% on Friday and the Dow lost 600 points heading into the weekend, good for a one-week drop of 2.1%.

Investors pummeled Intel, sending its shares down 26% after it announced it would lay off 15k people as part of a plan to cut bns of USD in spending.

The weak jobs report has some wondering whether the Fed will need to cut rates by more than a quarter point when it meets in September. While rate cuts should be good for equities (lower rates sends money into the stock market looking for better returns), the concern is that the Fed may have waited too long to act, setting up worries about the health of the US economy.

WATCH THIS SPACE #1- Berkshire nearly halves its stake in Apple: Warren Buffett’s Berkshire Hathaway cut its massive stake in Apple by nearly 50% to USD 84.2 bn in 2Q 2024, the firm’s latest earnings filing (pdf) showed. The stake sale, which raised the conglomerate’s cash holdings to a record USD 277 bn, is part of a wider sell off that saw Berkshire offload some USD 75.5 bn worth of stock on a net basis during the quarter as the S&P 500 rallied.

Could this add momentum to a risk-off, signaling that cash is king? “You could conclude this is another sell signal,” Edward Jones analyst Jim Shanahan said. “This was a far higher level of selling activity than we were expecting.”

WATCH THIS SPACE #2- Is all of this a signal that we’re in for a turbulent fall? Mayhaps, to quote the resident 17-year-old. Bloomberg has a rundown of views well worth your reading.

The bottom line? “This is what a growth scare looks like,” Wasif Latif, president and chief investment officer at Sarmaya Partners, told Reuters. “The market is now realizing that the economy is indeed slowing.”

Want more? See reports in the Financial Times | Reuters | CNBC

MEANWHILE- The Bank of England on Thursday cut interest rates for the first time in four years, delivering a quarter-point cut to 5% after maintaining a 16-year high of 5.25% since last August.

TASI

12,046

-0.5% (YTD: +0.7%)

MSCI Tadawul 30

1,513

-0.5% (YTD: -2.5%)

NomuC

26,609

-0.2% (YTD: +8.5%)

USD : SAR (SAMA)

USD 3.75 Sell

USD 3.75 Buy

Interest rates

6.5% repo

5.5% reverse repo

EGX30

29,379

+1.2% (YTD: +18.0%)

ADX

9,292

-0.8% (YTD: -3.0%)

DFM

4,237

-1.0% (YTD: +4.4%)

S&P 500

5,347

-1.8% (YTD: +12.1%)

FTSE 100

8,175

-1.3% (YTD: +5.7%)

Euro Stoxx 50

4,639

-2.7% (YTD: +2.6%)

Brent crude

USD 76.81

-3.4%

Natural gas (Nymex)

USD 1.97

-0.5%

Gold

USD 2,470

-0.4%

BTC

USD 60,600

-2.1% (YTD: +43.3%)

THE CLOSING BELL: TADAWUL-

The TASI declined 0.5% on Thursday on turnover of SAR 6 bn. The index is up 0.7% YTD.

In the green: Cenomi Retail (+6%), Petro Rabigh (+5%) and Care (+3.6%).

In the red: Gulf Union Alahlia (-10%), Kingdom (-8%) and Saico (-7%).

THE CLOSING BELL: NOMU-

The NomuC declined 0.2% on Thursday on turnover of SAR 43 mn. The index is up 8.5% YTD.

In the green: Obeikan Glass (+18%), Leaf (+7.6%) and Saudi Top (+67%).

In the red: Horizon Food (-9.9%), Miral (-8%) and Osool And Bakheet (-6.8%)

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