Nasdaq Plunges 4% After Jobs Report, Tech Stocks Including Tesla Slide
TSLA•The Nasdaq 100 plunged 4% after the May payrolls report showed 172,000 jobs added, boosting odds of Federal Reserve rate hikes and triggering liquidation in high-growth names. Tesla shares underperformed as stretched valuations and leverage-driven momentum fueled the tech sector correction.
1. Jobs Report Spurs Fed Rate-Hike Odds
The U.S. added 172,000 jobs in May, surprising to the upside and shifting market expectations from paused interest rates to potential hikes. Traders increased Federal Reserve rate-hike probability, prompting a swift risk-off response across equity markets.
2. Broad Tech Liquidation Triggers Nasdaq Drop
Heavy selling in crowded, high-valuation sectors drove the Nasdaq 100 down by 4%, as momentum-driven positions and elevated leverage were unwound. Semiconductor stocks and AI-related names saw some of the sharpest declines during the session.
3. Impact on Tesla
As one of the largest components of the Nasdaq 100, Tesla shares fell on the broad tech downturn, reflecting investor caution around stretched valuations. The selloff underscored Tesla's sensitivity to shifts in market liquidity and interest-rate expectations.
