Stock market selloff returns from holiday

The S&P/NZX 50 Index dropped 156 points, or 1.3 percent, to 11,739.11. Within the index, 36 stocks fell, seven rose and seven were unchanged. Turnover was $161.8 million.

The correction in US tech stocks, that began last Thursday, continued overnight when US markets reopened after Labor Day and carried through to the local market.

“It is hard to know what the cause was other than the market getting a bit overheated and unwinding pretty quickly as they have a tendency to do,” said Brad Gordon, an investment adviser at Hobson Wealth Partners. 

The Nasdaq ran up to an all-time high before the selloff, which Gordon said may have been driven in part by Japanese investment firm Softbank's "big whale trade" as it spent billions on US tech stocks.