Everyone wants a simple narrative that explains the drop.
Sometimes there isn't one. Answering precisely why the price went down requires understanding the process, mindset, motivations, fears, and finances of every buyer and every seller everywhere. To this date, there is no consensus on the causes of the crashes of 1929, 1973-74, 1987, 2000-2002, and 2007-2008, although there's no shortage of simple narratives claiming to explain the causes.
Seemingly small changes in the behavior of buyers and sellers can have a disproportionate impact on market capitalization, because share prices are set at the margin by the last trade executed, between a particular buyer and a particular seller. Billions of shares of a stock could trade hands at $100/share, but if one share then trades hands at $1/share, the company's market capitalization at that moment is 99% lower, even though only one dollar changed hands. This sort of thing was in fact seen during the great crash of 1929, when there were occasionally no normal bids for some stocks, and tiny orders to buy them for less than $1/share suddenly were filled, temporarily sending market caps to near zero.
EDIT: I made many changes to this comment so it better reflects what I meant to write the first time around.
Sometimes there isn't one. Answering precisely why the price went down requires understanding the process, mindset, motivations, fears, and finances of every buyer and every seller everywhere. To this date, there is no consensus on the causes of the crashes of 1929, 1973-74, 1987, 2000-2002, and 2007-2008, although there's no shortage of simple narratives claiming to explain the causes.
Seemingly small changes in the behavior of buyers and sellers can have a disproportionate impact on market capitalization, because share prices are set at the margin by the last trade executed, between a particular buyer and a particular seller. Billions of shares of a stock could trade hands at $100/share, but if one share then trades hands at $1/share, the company's market capitalization at that moment is 99% lower, even though only one dollar changed hands. This sort of thing was in fact seen during the great crash of 1929, when there were occasionally no normal bids for some stocks, and tiny orders to buy them for less than $1/share suddenly were filled, temporarily sending market caps to near zero.
EDIT: I made many changes to this comment so it better reflects what I meant to write the first time around.