(CNBC) Stocks closed out the week with a big thud Friday, with the Nasdaq narrowly avoiding its worst one-day loss this year as momentum names got crushed for a second day. The Dow and S&P 500 finished far from their record highs hit earlier in the session.
"This is a spillover effect from the Nasdaq's momentum names into the broader market," said Art Hogan, chief market strategist at Wunderlich Securities. "We've seen momentum names weak over the week and that seems to have picked up steam today – 1,875 on the S&P 500 is going to be a critical level. If we close below that, people are going to see it as a resistance level."
For the second day, momentum stocks such as Tesla, Netflix, Amazon.com and Priceline fell heavily. Newly split Google Class A and Class C shares were both down more than 4 percent.
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"The jobs report was more or less in line with expectations but the market had been up for four-consecutive days," note Elliot Spar, market strategist at Stifel Nicolaus. "Those that were long the big cap NDX names used the rally as a selling opportunity...It got very ugly after yesterday's lows were pierced. Selling begets selling so money managers can protect their performance."