U.S. Stocks Take a Tumble in Historically Bad Month

U.S. stocks experienced significant declines on Tuesday, marking one of the weakest starts to a historically rough month. The S&P 500, Nasdaq Composite, and Dow Jones indices recorded their largest daily percentage drops since early August. Market sentiment remains cautious, with traders anticipating key labor market data and Federal Reserve decisions.

U.S. stocks slumped on Tuesday, marking a weak start to a traditionally bad month as key data could influence Federal Reserve actions on interest rates. The S&P 500, Nasdaq Composite, and Dow Jones experienced their biggest daily drops since early August. Technology, energy, communication services, and materials led the decline.

Market sentiment weakened following the Institute for Supply Management's data, which showed subdued U.S. manufacturing despite a slight improvement in August. Historically, September has been a challenging month for stocks, noted Jason Browne of Alexis Investment Partners.

The Magnificent Seven tech stocks, which led this year's rally, also suffered. Nvidia dropped nearly 10%, and Alphabet, Apple, and Microsoft saw notable losses. The Dow fell 626.15 points, the S&P 500 dropped 119.47 points, and the Nasdaq Composite slid 577.33 points.

(With inputs from agencies.)