According to JPMorgan's note on Friday, retail investors made a significant purchase of $4.7 billion in stocks on Thursday, marking the highest level in the past ten years.

During this notable buying trend, retail investors focused on stocks like Nvidia, Amazon, and S&P exchange-traded funds, but they opted to sell their holdings in Tesla. Among retail investors, small-cap technology stocks were popular amidst the market downturn, while institutional investors increased their bearish positions in the sector.

On Thursday, the S&P 500 experienced a 4.9% drop, marking its largest single-day percentage decline since June 2020, following U.S. President Donald Trump's announcement of new import tariffs that generated concerns about a worldwide economic recession.

JPMorgan noted that retail investors behaved differently on Thursday compared to the COVID-induced selloff in March 2020. Retail investors' activities on Thursday aligned with the S&P 500 index losses for the day, while their stock portfolios showed an average year-to-date decline of 12.9%, which is less than the index's performance.

Carolina Mandl reported from New York; Editing by Matthew Lewis.