Stocks Slip as Valuation Jitters, Layoff Spike, and Tesla’s Mega-pay Vote Sour the Mood

Bloomberg and Reuters contributed to this report.

Wall Street finally hit the brakes. The Dow fell about 450 points Thursday while the S&P 500 and Nasdaq each slid more than 1%, as investors took profits after a torrid rally and fretted that sky-high tech valuations may be running ahead of reality.

Solid service-sector readings and a hotter-than-expected private jobs gain steadied sentiment briefly, but they also muddied the case for another Fed rate cut next month. Treasury yields climbed, with longer maturities pushing to near one-month highs, a move that tends to compress equity multiples — especially for richly valued growth names.

Earnings didn’t help the tone. Qualcomm sank after flagging a hit from lost Samsung business despite headline beats, and a grab bag of tech and consumer names traded heavy as guidance failed to clear an already lofty bar. Robinhood also slipped alongside broader risk aversion. Under the surface, a fresh wave of cost discipline is rippling across Corporate America: Challenger, Gray & Christmas tallied more than 150,000 October layoffs, the most for any October in 22 years, with warehousing and tech leading the cuts and AI adoption increasingly cited as a driver.

Macro noise piled on. The Supreme Court’s skeptical grilling of the administration’s sweeping tariffs injected fresh uncertainty into trade policy just as the record government shutdown forced investors to lean on private data. Meanwhile, transportation officials warned of a 10% flight reduction at 40 major US airports to manage air-traffic safety during the funding lapse — another reminder of mounting frictions in the real economy.

All eyes also swung to Austin, where Tesla shareholders were set to vote on a jaw-dropping compensation plan that could hand Elon Musk up to $878 billion in stock over the next decade if the company hits a ladder of moonshot targets. Approval would signal confidence in Musk’s pivot from pure EV maker to AI and robotics powerhouse; a no vote risks fresh upheaval around leadership, strategy, and talent.

Overseas, Asia eked out gains led by China while Europe drifted lower. Sterling perked up into a knife-edge Bank of England decision as traders weighed a possible cut against a tighter UK fiscal backdrop. In cross-assets, the dollar eased, gold inched higher, and bitcoin slipped, reflecting a modest bid for safety without outright panic.

Between pricier stocks, stickier yields, a jump in layoff announcements, and a market-moving Tesla vote, the path of least resistance was lower. With a phalanx of Fed speakers on deck and a heavy earnings slate still to go, dip buyers may get another chance — just not at yesterday’s multiples.