US STOCKS-Wall St tumbles on tech selloff, recovery worries

(For a live blog on the U.S. stock market, click LIVE/ or
type LIVE/ in a news window.)
* VIX jumps to a seven-week high
* Weekly jobless claims slip below 1 mln
* Tesla drops for the third straight day
* Indexes fall: Dow 2.38%, S&P 3.20%, Nasdaq 4.67%

(Updates to early afternoon)
By Medha Singh and Devik Jain
Sept 3 (Reuters) - Wall Street's main indexes tumbled on
Thursday, heading for their worst day since June as investors
dumped high-flying technology-focused stocks, while economic
data highlighted concerns about a long and difficult recovery.
Shares of Facebook Inc FB.O , Apple Inc AAPL.O ,
Amazon.com Inc AMZN.O , Microsoft Inc MSFT.O and
Google-parent Alphabet Inc GOOGL.O sank between 4.9% and 7%.
The five stocks, deemed stay-at-home winners during the
coronavirus crisis, account for nearly a quarter of the S&P
500's market capitalization and have driven the stock market's
narrow technology-led recovery from the pandemic lows hit in
March.
The NYSE FANG+TM Index .NYFANG , which includes the core
FAANG stocks, shed 5.5%, putting it on track for its biggest
one-day decline since March 16.
The Philadelphia chip index .SOX and the S&P tech sector
.SPLRCT also dropped about 5% each, with investors also
booking profits ahead of the Labor Day long weekend.
"Some of the stocks have gotten a little pricey, and what
the actual cause is to spark this selloff is difficult to say,"
said Randy Frederick, vice-president of trading and derivatives
for Charles Schwab in Austin.
"The leading sector for quite a long time has been the
Nasdaq, which is very heavily weighted in technology stocks so
people just saw this as an opportunity to take the profits off
the table."
The pullback in stocks comes a day after the S&P 500 and the
Nasdaq closed at record levels and the Dow came within 1.5% of
its February peak, powered by unprecedented fiscal and monetary
support.
Earlier in the day, data showed the number of Americans
filing new claims for unemployment benefits fell more than
expected last week, but remained extraordinarily high. The
closely watched monthly payrolls report is set for
Friday Separately, a survey showed U.S. services industry growth
slowed in August, likely as the boost from the reopening of
businesses and fiscal stimulus faded. Wall Street's fear gauge .VIX crossed its 200-day moving
average to hit its highest level in seven weeks.
At 12:44 p.m. ET, the Dow Jones Industrial Average .DJI
was down 692.33 points, or 2.38%, at 28,408.17, the S&P 500
.SPX was down 114.67 points, or 3.20%, at 3,466.17. The Nasdaq
Composite .IXIC was down 563.63 points, or 4.67%, at
11,492.81.
"The prevalent attitude in the market now is that this is a
healthy correction," said Mike Zigmont, head of trading and
research at Harvest Volatility Management in New York.
"(Investors) are in love with tech stocks and it's going to
take more than this for them to fall out of love with them."
Tesla Inc TSLA.O tumbled 8%, falling for the third
straight session.
PVH Corp PVH.N rose 4.5% after the Calvin Klein owner
posted a surprise quarterly profit, boosted by strong online
demand for comfortable and casual clothing during the
coronavirus-led shift to work from home. Declining issues outnumbered advancers for a 3.25-to-1 ratio
on the NYSE and for a 3.76-to-1 ratio on the Nasdaq.
The S&P index recorded 18 new 52-week highs and no new low,
while the Nasdaq recorded 23 new highs and 45 new lows.