NEW YORK — A stumble by Apple set off a rout in the stock market Thursday, its worst day in nearly two months.
The selling started early and picked up strength in the afternoon. By the close of trading, all 30 big companies in the Dow Jones industrial average and the 10 industries in the Standard & Poor’s 500 index lost ground.
Additional Images
Most investors said the drop wasn’t a sign of worry because all the forces behind the market’s long rally remain in place. It was only a week ago that the S&P 500 touched a record high, and strong runs are usually followed by short breaks. The index has lost 2 percent this week but is still up 6 percent for the year.
“There’s just an absence of real news to chew on,” said Mark Luschini, the chief investment strategist at Janney Montgomery Scott. “When you’re at a peak, markets need more and more good news to keep climbing.”
The S&P 500 index lost 32.31 points, or 1.6 percent, to close at 1,965.99.
The Dow slumped 264.26 points, or 1.5 percent, to close at 16,945.80. The Nasdaq composite, which is dominated by technology companies, dropped 88.47 points, or 1.9 percent, to 4,466.75.
It was the worst day for all three indexes since July 31.
Technology companies were hit hardest. Apple dropped nearly 4 percent after its announcement late Wednesday that it had pulled a software update that prevented users from making phone calls. Others complained that they bent their new iPhones by sitting on them. Apple lost $3.88 to $97.87 in heavy trading.
Two economic reports out Thursday were little help. Claims for unemployment benefits crept up last week. But the less volatile four-week average fell for the second straight week. A separate report said business orders for equipment plunged last month, mainly a result of a drop in orders for commercial aircraft.
“The economic numbers were negative, but not alarming and don’t change the direction of the economy at this time,” said Peter Cardillo, chief market economist at Rockwell Global Financial.
Henry Smith, chief investment officer at Haverford Trust, said there was no fundamental reason behind the big drop Thursday. A sudden turn might seem alarming because it’s so unusual.
Some investment analysts have been warning that the market has been calm for too long and say a 10 percent drop, known as a “correction,” is overdue. Since World War II, they typically hit every 18 months, according to S&P Capital IQ. The last one hit in August 2011.
“Big pullbacks are normal in a bull market,” said Smith. “What’s abnormal is that we’ve gone three years without one.”
Send questions/comments to the editors.
Success. Please wait for the page to reload. If the page does not reload within 5 seconds, please refresh the page.
Enter your email and password to access comments.
Hi, to comment on stories you must . This profile is in addition to your subscription and website login.
Already have a commenting profile? .
Invalid username/password.
Please check your email to confirm and complete your registration.
Only subscribers are eligible to post comments. Please subscribe or login first for digital access. Here’s why.
Use the form below to reset your password. When you've submitted your account email, we will send an email with a reset code.