Tesla shares bounce after record plunge

The Charging Bull statue is shown in New York’s financial district Tuesday Sept. 8 2020. More sharp declines for big tech stocks are dragging Wall Street toward a third straight loss on Tuesday

Asian shares declined on Wednesday after a sell-off of big technology stocks on Wall Street pulled US benchmarks lower.

The Dow Jones Industrial Average fell 632.42 points, or 2.25 per cent, to 27,500.89, the S&P 500 lost 95.12 points, or 2.78 per cent, to 3,331.84 and the Nasdaq Composite dropped 465.44 points, or 4.11 per cent, to 10,847.69. Big names that were the main reasons for the market's rocket ride back from its pandemic-caused losses were among the heaviest weights.

ANZ dropped 3% to $17.81, Commonwealth Bank fell almost 2.5% to $66.79, National Australia Bank lost 2.57% to $17.44 and Westpac slid 3.34% to close at $17.07.

The Nasdaq - seen as the bellwether for the U.S. stock market - fell into correction territory after dropping 10 per cent from its record close last week, and down 4.1 per cent on Tuesday night at 10,847.69 in NY.

The Russell 2000 index of smaller company stocks gave up 30.71 points, or 2%, to 1,504.59.

Tesla plunged 21 per cent to suffer its biggest daily drop as the electric-car maker was excluded from a group of companies being added to the S&P 500 index. The Australian energy sector skidded 3.8 per cent to its lowest point since May.

Financials were down 2.95 per cent and materials dropped 1.47 per cent. But it's notably higher than the 0.53% it was offering at the end of July. But the fever broke on Thursday, with the S&P 500 dropping 7% in three days, its longest losing streak in almost three months.

Up to Friday's close, the stock had surged about 400 per cent this year. Apple sank 6.7%, Microsoft pulled 5.4% lower and tech stocks across the index were down 4.6%.

USA stocks opened sharply lower on Tuesday as investors continue to rotate out of the tech sector.

"On the one hand, the slide in the share price is due to its non-inclusion in the S&P 500, but on the other hand the slide is also a normalization of the company's valuation", Frank Schwope, an analyst at NORD/LB, said.

"I'm more and more certain that we have seen the peak particularly in USA tech stocks, and they were the only things holding up the broader market", said Brad Smoling, managing director at Smoling Stockbroking.

Prices for the 10-Year Treasury stayed put, maintaining yields at Tuesday's 0.68%.

Among the big four banks, ANZ and Westpac gave up 3.4 per cent, NAB 3.1 per cent and CBA 2.8 per cent. Miners fared better: BHP declined 2.1 per cent, Newcrest 1.3 per cent and Fortescue Metals 2.4 per cent.

Benchmark U.S. crude recovered early losses, gaining 53 cents to $37.28 per barrel in electronic trading on the New York Mercantile Exchange. Apache lost 10.7%, and Diamondback Energy fell 10% after benchmark US crude sank $3.01 to $36.76 per barrel. Brent crude, the worldwide standard, picked up 40 cents to $40.18 per barrel.