The NASDAQ Composite was still up 23.75% as of the close on October 25. But the index is now down 12.2% from its July 31 high as of the close on October 26.
That’s correction territory.
And right now the index looks inclined to hold its downward trend for a while. The NASDAQ closed down another 1.76% today because while tech companies are reporting good earnings for the recently concluded third quarter, they’re expressing caution in their guidance for the fourth quarter and the early part of 2024.
With the NASDAQ slipping into correction, investors and traders are now looking at two major indexes in a correction. The small-cap Russell 2000, even after today’s gain of 0.34%, is down 18.7% from its July 31 close as of the close on October 26.
It’s not a good sign when two indexes move into correction. It suggests that the damage is speeding and that there’s more selling to come.