The Dow Jones Industrial Average .DJI fell 665.75 points, below the psychologically important level of 26,000, which it had just broken through for the first time two-and-a-half weeks ago. The Dow's decline of 2.5% was mirrored in other major indices. The S&P 500 fell 2.2%, and the Nasdaq Composite declined 2%.
The market has surged in the "Trump rally" as analysts priced in projected higher earnings from the prospect of corporation-friendly tax cuts, regulatory rollbacks and infrastructure investment under the new administration. But investors sold off Friday on fears that a stronger-than-expected jobs report would spur the Federal Reserve to raise interest rates more than expected. Higher interest rates for debt can spur investors to pull money out of the stock market to put into bonds.
To put the day's move in a broader context the point drop in the Dow (which is a basket of 30 large U.S. company stocks versus the 500 or so stocks in the S&P) was just 2.5%, according to CNBC. The last time the Dow closed down 500 or more points was after Britain voted to leave the European Union, June 24, 2016, when it fell 610 points, then a 3.4 percent move.
The Dow's biggest drop in points in a single day was 777.68 on Sept. 29, 2008, in the midst of the financial crisis. That would be just a 3 percent drop these days. It was a 6.89 percent fall back then.