2024-09-05 21:36:33
Investors again moved away from risk assets amid concerns about the outlook for the US economy, awaiting tomorrow’s crucial August US jobs data.
Wall Street finally closed in mixed signs after showing sharp fluctuations during the session.
THE S&P 500 fell 0.3%, to 5,503.41 units, while o Dow Jones recorded losses of 219.22 points or 0.54% to close at 40,755.75 points. THE Nasdaq however, it managed to close with a rise of 0.25% to 17,127.66 points, after having registered a rise of 1.2% at the beginning of the session.
“We are in the midst of a new wave of growth concerns in the US,” said Arun Sai, strategist at Pictet Asset Management.
U.S. private sector job creation data was disappointing as it showed the fewest jobs since 2021, rekindling concerns about a slowing labor market. However, jobless claims data showed a drop over the past week.
Traders are betting that the Fed will cut interest rates this year by 100 basis points, meaning a rate cut of more than 25 basis points. Also given Fed Chairman Jerome Powell’s emphasis on the labor market, many on Wall Street believe that tomorrow’s employment data will indicate whether the Fed will cut by 25 or 50 basis points this month.
For Interactive Brokers’ Steve Sosnick, the risk is that even if the Fed is determined to act aggressively, it may be too late to counter the economic slowdown.
Also, Tesla stock rose 4.9% after the electric vehicle maker said it plans to start making self-driving software in Europe and China early next year. Frontier Communications fell 9.5% after Verizon announced its intention to buy the company in a $20 billion deal.