Investors went for a wild ride Nov. 20 as the U.S. stock market dramatically fluctuated throughout the day.
Nvidia reported strong earnings Nov. 19, offering investors a boost of confidence and temporarily calming concerns of an AI bubble. However, according to CNN Business, the relief was short lived, with stocks taking a dive in the middle of the day on Nov. 20, coinciding with the release of the delayed September jobs report.
By the close of the market Thursday, as reported by USA TODAY, the Dow was down 386.51 points, the Nasdaq was down 486.181 points, and the S&P 500 dropped 103.40 points.
But what actually caused the drop? Here’s what you need to know.
What caused the stock market to drop on Thursday?
The dip in the market followed the release of the September jobs report. Per USA TODAY, this report, which was delayed for more than a month due to the government shutdown, appeared to crush hopes for a December rate cut.
The report found that U.S. employers added 119,000 jobs in September. However, the unemployment rate rose slightly from 4.3% to 4.4%. Additionally, according to USA TODAY, job gains for July and August were revised down by 33,000.
Per CNN, while Nvidia’s positive earnings and the release of the jobs report brought answers, they also raised new and more difficult questions for traders.
“Investors looking for an explanation for the current market pullback should look no further than the recent uncertainties that have resurfaced,” Bret Kenwell, U.S. investment analyst at trading platform eToro told USA TODAY, highlighting questions about the Federal Reserve’s interest rate path, the labor market, tariffs and the government shutdown, which has left investors with an “incomplete picture” of the current economy.
“Markets don’t like uncertainty, and when it rises, we often see volatility as a result,” Kenwell said.
This uncertainty is likely to continue, according to multiple reports.
An October jobs report will not be released at all, the government said, due to the fact that data was not collected during the shutdown.
What is the market looking like on Friday?
Markets began to rebound on Friday, according to CNN, though Nvidia was “essentially flat.”
Bitcoin dipped another 1% Friday morning, CNN reported, adding that it is not only at its lowest level since April, but that it’s also on pace for its worst month since 2022.
Why is bitcoin dropping?
Bitcoin has been experiencing an increased sell-off, according to Business Insider, which reported that, as of Friday, it had tumbled below $84,000 and was headed toward its worst month since 2022.
Though its initial plummet began during a massive liquidation event in October, multiple factors are keeping up the pressure this week, Business Insider reported, including margin calls on leveraged positions, a bearish market and an uncertain outlook regarding interest rates.
