Tech Selloff, Robinhood Faces SEC

Equities fell Thursday, driven by a sharp selloff in some of tech’s highest-flying names. Microsoft (ticker: MSFT) fell 6% and Apple ( AAPL) fell 8% on Thursday, as the latter lost ground for the second day in a row. Tesla ( TSLA) lost nearly 10%, falling for the third straight day following its stock split on Monday.

“A pullback in tech stocks right now is understandable. The Nasdaq has advanced violently since March and many names are at absurd valuations,” says David Bahnsen, chief investment officer of The Bahnsen Group, in Newport Beach, California.

After having its best day in a couple months, the Dow Jones Industrial Average fell 807 points, or 2.8%, to finish at 28,292, while the tech-heavy Nasdaq shed a full 5% to close at 11,458.

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Fall in unemployment claims. Jobless claims for the week ending Aug. 28 released today by the Labor Department were better than expected at 881,000 versus expectations of 950,000. Claims fell 130,000 from the previous week and seem to be on a downward trend.

SEC fraud probe. Robinhood is under investigation over whether the trading app properly disclosed that customer trades were being sold to high-speed trading firms. The trading app could face a civil fraud suit, and if the company decides to settle, it may have to pay over $10 million to the Securities and Exchange Commission.

Snubbed SPAC proposal: Billionaire investor Bill Ackman approached Airbnb to merge with his blank check company, Pershing Square Capital Management but the home rental company dismissed the proposal and is planning a traditional initial public offering in 2020.

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