Stock market finally discovers economy is cooling. Indexes take big dives

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Dow Jones 30-stock index suffered a rare four-figure loss, dropping 1,033 points or 2.6%.

Specialist Dilip Patel works at his post on the floor of the New York Stock Exchange, Monday, Aug. 5, 2024. Nearly everything on Wall Street is tumbling as fear about a slowing U.S. economy worsens and sets off another sell-off for financial markets around the world.The venerable Dow Jones 30-stock index suffered a rare four-figure loss, dropping 1,033 points, or 2.6%.

That was a clear sign of over-exuberance. It’s the third-highest reading in a monthly survey dating to 1987 behind January 2018 and March 2024. On average, 36% are bullish on stocks during the past 37 years. Now a handful of tech stocks have skyrocketed behind the promise of artificial intelligence. Yet, hints of tech weakness have dribbled out in recent months in the form of repeated layoffs by numerous tech companies.

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