Nasdaq Drops Sharply, But Market Volatility Decreases

US stocks closed lower on Wednesday, after Target Corporation TGT posted downbeat quarterly results and issued weak holiday-sales outlook. The S&P 500 consumer discretionary sector, as a result, dipped 1.5% on Wednesday.

Micron Technology, Inc. MU shares dropped around 7% on Wednesday after the company announced it is reducing DRAM and NAND wafer starts by approximately 20% versus fiscal Q4 2022.

The Nasdaq 100 fell 1.45% to close at 11,699.09 on Wednesday, amid losses in shares of Tesla, Inc. TSLA and Amazon.com, Inc. AMZN. The S&P 500 fell 0.83%, while the Dow Jones fell around 39 points to settle at 33,553.83 in the previous session.

Majority of the sectors on the S&P 500 closed on a lower note, with energy and consumer discretionary stocks recording the biggest plunge on Wednesday. However, utilities and consumer staples stocks traded higher in the previous session.

The Chicago Board Options Exchange's CBOE Volatility Index (VIX) dropped 1.8% to 24.11 points.

What is CBOE Volatility Index?

The CBOE Volatility Index, popularly known as VIX, is a measure of the equity market's expectation of volatility based on S&P 500 index call and put options.