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[bigdog]

Asian stocks follow Wall St down after Fed inflation report

Asian stock markets have followed Wall Street lower after the Federal Reserve said U.S. inflation is too high, suggesting support for more aggressive interest rate hikes.

apnews.com

Stocks slip on Wall Street, erasing weekly gains for S&P 500​

By DAMIAN J. TROISE and ALEX VEIGA

Stocks on Wall Street closed broadly lower Wednesday as drops by big technology companies wiped out the S&P 500′s gains for the week.

The benchmark index fell 0.7%, snapping a three-day winning streak. The Dow Jones Industrial Average fell 0.5% and the tech-heavy Nasdaq slid 1.3%.

Small-company stocks fell more sharply than the rest of the market, pulling the Russell 2000 1.6% lower.

Traders focused on a mix of retail updates that indicate inflation pressure continues to affect businesses and consumers, but also shows that spending remains strong. A government report showed retail sales were flat last month, and Target shares slumped after the retail chain reported a nearly 90% skid in quarterly profits.

“You saw Target coming out and being softer than we thought, so maybe it spooked investors a little bit,” said Sylvia Jablonski, chief investment officer at Defiance ETFs. “It’s a small correction from the bear market rally.”

The S&P 500 slipped 31.16 points to 4,274.04. The loss pulled the index 0.1% lower so far this week.

The Dow dropped 171.69 points to 33,980.32, while the Nasdaq fell 164.43 points to 12,938.12. The Russell 2000 slid 33.22 points to 1,987.31.

Trading has been choppy throughout the week as the benchmark S&P 500 comes off a four-week winning streak.

Pricey technology companies, communication stocks and retailers had some of the biggest losses. Only energy stocks notched gains as the price of U.S. crude oil rose.

Bond yields rose significantly. The yield on the 10-year Treasury rose to 2.89% from 2.81% late Tuesday.

Wall Street has been closely reviewing the latest economic data and corporate updates to get a better sense of how inflation is affecting businesses and consumers and whether the hottest inflation in 40 years is peaking or beginning to cool. Investors are also monitoring inflation to determine how much further central banks have to go in their fight against higher prices.

Sales at U.S. retailers were unchanged last month, according to the Commerce Department, and economists had expected a slight increase in July. Part of the weakness came from a 1.8% drop in gas sales, reflecting lower prices at the pump.

Meanwhile, Target fell 2.7% after reporting a nearly 90% plunge in second quarter profits as it was forced to slash prices to clear unwanted inventories. The retailer warned earlier this summer that it was canceling orders from suppliers and aggressively cutting prices because of a pronounced spending shift by Americans as the pandemic eased.

Children’s clothing and accessories chain Children’s Place fell 11% after reporting a surprise second-quarter loss as it faced supply chain problems and pressure from inflation.

Britain’s inflation rate rose to a new 40-year high of 10.1% in July, a faster pace than in the U.S. and Europe as climbing food prices in the United Kingdom tightened a cost-of-living squeeze fueled by the soaring cost of energy. Inflation pressures prompted the Bank of England to boost its key interest rate by half a percentage point this month, the biggest of six consecutive increases since December.

The Federal Reserve has been raising interest rates in order to slow the economy and temper inflation, but investors remain concerned that it could hit the brakes too hard and send the economy into a recession. The Fed in July raised its benchmark interest rate by three-quarters of a point for a second-straight time.

The central bank’s minutes from last month’s meeting of policymakers didn’t offer any new insight into the Fed’s struggle to quell inflation. The minutes, released Wednesday afternoon, showed that Fed policymakers expected the economy to expand in the second half of 2022, though many suggested that growth would weaken as higher rates take hold.

Slower growth, they noted, could “set the stage” for inflation to gradually fall to the central bank’s 2% annual goal, though it remained “far above’’ that target. But the policymakers made clear that for now, they intend to continue raising rates enough to slow the economy.

Stocks on Wall Street closed broadly lower Wednesday as drops by big technology companies wiped out the S&P 500′s gains for the week.

The S&P 500 slipped 31.16 points to 4,274.04. The loss pulled the index 0.1% lower so far this week.

The Dow dropped 171.69 points to 33,980.32, while the Nasdaq fell 164.43 points to 12,938.12. The Russell 2000 slid 33.22 points to 1,987.31

 

[bigdog]

Asian markets mixed after Wall St gains on jobs data

Asian stock markets are mixed after Wall Street rose as investors analyzed conflicting economic signals ahead of a Federal Reserve conference next week.

apnews.com

Stocks end higher on Wall Street after more choppy trading​

By DAMIAN J. TROISE and ALEX VEIGA

Another day of choppy trading on Wall Street ended with modest gains for stocks Thursday and the benchmark S&P 500 barely back into the green for the week.

The S&P 500 rose 0.2% after shifting between small gains and losses for much of the day. It’s now up 0.1% for the week.

The Dow Jones Industrial Average managed a 0.1% gain, while the Nasdaq rose 0.2% as technology companies gained ground.

Smaller company stocks outpaced the broader market, sending the Russell 2000 index 0.7% higher.

The choppy trading for stocks follows a four-week winning streak for the S&P 500. Investors remain concerned about stubbornly hot inflation and its impact on consumers and businesses. Financial results from big retailers and economic updates throughout the week have shown that the economy remains under pressure from inflation, but has several pockets of resiliency.

“The market is looking for direction and it seems people are caught between the idea of slowing economic growth and slowing inflation,” said Chris Zaccarelli, chief investment officer at Independent Advisor Alliance.

The S&P 500 rose 9.70 points to 4,283.74, while the Dow added 18.72 points to 33,999.04. The Nasdaq gained 27.22 points to 12,965.34, and the Russell 2000 added 13.41 points to 2,000.73.

Technology companies had some of the strongest gains. Cisco Systems rose 5.8% after reporting solid financial results.

Energy stocks also climbed as U.S. crude oil prices rose 2.7%. Devon Energy rose 5.9%.

Department store Kohl’s fell 7.7% after issuing a disappointing financial forecast.

Bond yields fell. The yield on the 10-year Treasury, which affects mortgage rates, slipped to 2.87% from 2.90% late Wednesday.

Bed Bath & Beyond fell 19.6% after investor Ryan Cohen proposed selling his entire stake in the struggling retailer.

Slightly fewer Americans filed for unemployment benefits last week, according to the Labor Department, as the labor market continues to stand out as one of the strongest segments of the U.S. economy. The solid update on the employment market follows an encouraging report on Wednesday that showed retail sales remain solid despite the hottest inflation in four decades.

Investors have been closely watching the Federal Reserve for any reaction to shifts in inflation or the economy. The central bank has been raising interest rates in an effort to slow the economy and cool inflation, but Wall Street is concerned it could slam the brakes too hard and veer into a recession instead.

Any sign that inflation is peaking or cooling has given Wall Street hope that the Fed could consider easing up on rate hikes. It raised its benchmark interest rate by three-quarters of a point for a second-straight time during its meeting in July and is expected to raise the rate by a half-percentage point at its upcoming meeting.

The minutes from last month’s meeting of Federal Reserve policymakers showed that policymakers expected the economy to expand in the second half of 2022, though many suggested that growth would weaken as higher rates take hold. The Fed intends to continue raising rates enough to slow the economy

Wall Street continues monitoring potential trade issues between the U.S. and China after the U.S. government said it will hold trade talks with Taiwan in a sign of support for the island democracy that China claims as its own territory, prompting Beijing to warn that it will take action if necessary to “safeguard its sovereignty.”

The S&P 500 rose 0.2% after shifting between small gains and losses for much of the day. It’s now up 0.1% for the week.

The Dow Jones Industrial Average managed a 0.1% gain, while the Nasdaq rose 0.2% as technology companies gained ground.

The S&P 500 rose 9.70 points to 4,283.74, while the Dow added 18.72 points to 33,999.04. The Nasdaq gained 27.22 points to 12,965.34, and the Russell 2000 added 13.41 points to 2,000.73

 

[bigdog]

Tech stocks lead Wall Street lower, breaking winning streak

Technology stocks led Wall Street lower, leaving major indexes in the red for the week. The benchmark S&P 500 index gave back 1.3% Friday, breaking a four-week winning streak.

apnews.com

Tech stocks lead Wall Street lower, breaking winning streak​

By DAMIAN J. TROISE and ALEX VEIGA

Wall Street capped a choppy week of trading Friday with a broad slide for stocks that left the major indexes in the red for the week.

The S&P 500 closed 1.3% lower, breaking a four-week winning streak. Shares in more than 80% of the companies in the benchmark index fell, with technology stocks driving much of the pullback.

The tech-heavy Nasdaq composite fell 2% and also ended four weeks of gains. The Dow Jones Industrial Average dropped 0.9%, ending slightly in the red for the week. Small company stocks also lost ground, pulling the Russell 2000 index 2.2% lower.

Friday marked the heaviest selling for the market, including the S&P 500′s biggest decline in more than seven weeks, after a solid run of weekly gains. The strong market rally in July and early August followed better-than-expected company earnings and signs that the economy is slowing, possibly setting the stage for less aggressive rate hikes, the Federal Reserve’s main tool for taming surging inflation.

Minutes from the central bank’s interest rate policy meeting last month and recent statements by Fed officials appeared to signal that the Fed may not be prepared to relent just yet from its pace of rate increases, said Quincy Krosby, chief equity strategist for LPL Financial.

“That put the market on notice that perhaps the market may have to contend with a Fed that continues to raise rates at a steady pace and perhaps does not pause and take its foot off the pedal,” she said.

That gave traders “the perfect excuse to finally begin to burn off” some of the market’s recent gains.

The S&P 500 fell 55.26 points to 4,227.48. It ended with a 1.2% loss for the week and is now down 11.3% so far this year.

The Dow dropped 292.30 points to 33,706.74, while the Nasdaq slid 260.13 points to 12,705.22. The Russell 2000 gave up 43.38 points to 1,957.35.

Technology stocks had some of the biggest losses and the sector’s dip weighed heavily on the broader market. Microsoft fell 1.4%.

Retailers, banks and communications companies also fell sharply amid the broad slide.

Meme stock Bed Bath & Beyond sank 40.5% after the high-profile activist investor Ryan Cohen confirmed that he’s sold his stake in the company.

Cryptocurrencies fell broadly as Bitcoin slumped 8.5% to $21,370, according to CoinDesk.

Bright spots included General Motors, which rose 2.5% after reinstating its dividend. Foot Locker soared 20% after replacing its CEO and reporting earnings that beat Wall Street’s estimates.

Bond yields gained ground, reflecting expectations of further interest rate hikes. The yield on the 10-year Treasury rose to 2.97% from 2.89% late Thursday.

Traders had no shortage of company and economic data to review this week, including the latest batch of earnings from retailers and updates on spending, home sales and the employment market.

Big retailers including Walmart and Target have warned investors that inflation is crimping consumer spending. Department store owner Macy’s will report its results next week.

A report on retail sales this week showed that spending remains resilient as gasoline prices fall and help ease some pressure from inflation.

Wall Street is trying to determine how stubbornly hot inflation is affecting businesses and consumers and whether the economy can remain resilient and avoid a recession.

The data from government and corporate reports is also being closely watched as investors try to determine how the Federal Reserve will continue with its plan to fight inflation by raising interest rates. The goal is to raise rates and slow down economic growth to cool inflation. But, the central bank is threading a fine line between taming inflation in an already slowing economy and hitting the brakes too hard and veering the economy into a recession.

Minutes of the Fed’s July meeting released this week said inflation is still is too high and made clear the central bank will keep raising interest rates. The central bank has raised interest rates twice this year by 0.75 percentage points, triple its usual margin. Forecasters currently expect a hike of a half-percentage point at the board’s next meeting.

Wall Street will be keenly watching next week’s speech by Federal Reserve Chair Jerome Powell at an annual conference in Jackson Hole, Wyoming.

“The question is does he engage the market with his assessment of the direction of inflation, the progress the Fed is making and offer any suggestion of the direction of rate hikes?” Krosby said.

 

[bigdog]

Wall Street capped a choppy week of trading Friday with a broad slide for stocks that left the major indexes in the red for the week.

The S&P 500 fell 55.26 points to 4,227.48. It ended with a 1.2% loss for the week and is now down 11.3% so far this year.


The Dow dropped 292.30 points to 33,706.74, while the Nasdaq slid 260.13 points to 12,705.22. The Russell 2000 gave up 43.38 points to 1,957.35

 

[bigdog]

Asian shares fall on Fed worries after Wall Street sell-off

Asian shares are trading lower, echoing a broad sell-off on Wall Street amid speculation about another interest rate raise from the U.S. Federal Reserve.

apnews.com

Stocks fall broadly on Wall Street, extending market losses

By DAMIAN J. TROISE and ALEX VEIGA

Another broad stock market sell-off on Monday deepened Wall Street’s losses from last week, leaving the S&P 500 with its biggest slide since mid-June.

The benchmark index fell 2.1%, nearly doubling its losses from last week, when it broke a four-week winning streak. The Dow Jones Industrial Average slumped 1.9% and the Nasdaq dropped 2.5%.

Technology companies and retailers had some of the heaviest losses. Smaller company stocks also lost ground, pulling the Russell 2000 index 2.1% lower.

The latest market slide comes as investors grapple with uncertainty over when the highest inflation in decades will ease significantly, how much will the Federal Reserve have to raise interest rates in order to get it under control and how much will the rate hikes slow the economy.

Wall Street will be looking for insight into these unknowns later this week, when the Federal Reserve holds its annual meeting in Jackson Hole, Wyoming.

“Volatility spiked as investors are increasingly nervous about what they might hear from officials at the Fed’s upcoming Jackson Hole symposium,” said Jeffrey Roach, chief economist for LPL Financial.

The S&P 500 fell 90.49 points to 4,137.99. The Dow lost 643.13 points to close at 33,063.61, while the Nasdaq fell 323.64 points to 12,381.57. The Russell 2000 gave up 41.60 points to 1,915.74.

Some 95% of the stocks in the S&P 500 fell. Technology companies, retailers, banks and communications services stocks accounted for a big share of the index’s slide. Microsoft fell 2.9% and Target fell 3%. JPMorgan dropped 1.7% and Netflix slid 6.1%.

Movie theater operators also fell in choppy trading following news that Cineworld is considering filing for Chapter 11 bankruptcy protection. The industry is still struggling to recover from the virus pandemic. AMC Entertainment fell 5.5% and Cinemark fell 5.8%.

Bright spots in the market included Signify Health, which jumped 32.1% after The Wall Street Journal reported that Amazon would bid for the company.

Bond yields gained ground. The yield on the 10-year Treasury, which influences rates on home mortgages and other loans, rose to 3.03% from 2.97% late Friday.

The broader market’s losses come on the heels of a weekslong rally. Investors are trying to figure out where the economy goes from here as stubbornly hot inflation hurts businesses and consumers. Record-high inflation also has investors focusing on central banks and their efforts to fight high prices without further damaging economic growth.

“You’ve had quite a rally and there’s reason to not be sure where we’re going from here,” said Tom Martin, senior portfolio manager with Globalt Investments. “There’s still decent potential for a recession.”

Minutes last week from the Federal Reserve’s July board meeting affirmed plans for more rate hikes despite signs of weaker economic activity. Traders worry aggressive steps to slow the economy might go too far and bring on a recession. The U.S. economy has already contracted through the first half of 2022 and Wall Street will get more information on Thursday when the government releases an updated report on the U.S. economy for the second quarter.

Investors are also looking ahead to this week’s Federal Reserve conference for signals about more possible U.S. rate hikes to cool surging inflation. Fed Chair Jerome Powell is scheduled to give a speech on Friday morning at the central bank’s annual meeting in Jackson Hole, which starts Thursday.

The Fed is holding its meeting following a heavy week of company and economic data that showed inflation is still squeezing the economy, but consumer spending remains resilient. Falling gasoline and food commodity prices, for wheat and corn, have helped relieve some of that pressure. That helped essentially stall inflation’s advance in July, though prices still remain stubbornly high.

“I don’t think we’re out of the woods yet on inflation,” Martin said. “We still don’t really know how inflation is going to pan out and what the Fed is going to do.”

The benchmark S&P 500 index fell 2.1%, nearly doubling its losses from last week, when it broke a four-week winning streak. The Dow Jones Industrial Average slumped 1.9% and the Nasdaq dropped 2.5%.

The S&P 500 fell 90.49 points to 4,137.99. The Dow lost 643.13 points to close at 33,063.61, while the Nasdaq fell 323.64 points to 12,381.57. The Russell 2000 gave up 41.60 points to 1,915.74.

 

[bigdog]

Asian shares mixed after modest Wall Street fall

Asian shares are trading mixed as a wait-and-see mood set in following another, but more modest, day of sell-offs on Wall Street.

apnews.com

Stocks dip as steadying yields calm Wall Street after fall​

By DAMIAN J. TROISE and STAN CHOE

NEW YORK (AP) — Stocks drifted to modest losses in a quiet Tuesday on Wall Street, as steadying Treasury yields helped calm the market following its worst tumble in months.

The S&P 500 dipped 9.26 points, or 0.2%, to 4,128.73 after flipping between small gains and losses through the day. The edge lower follows up on Monday’s sharp 2.1% drop, which came on the heels of the first losing week for the index in the last five.

The Dow Jones Industrial Average fell 154.02, or 0.5%, to 32,909.59, and the Nasdaq composite slipped 0.27, or less than 0.1%, to 12381.30. Stocks of smaller companies held up better than the rest of the market, and the Russell 2000 index ticked up by 0.2%.

Volatility has returned to Wall Street following what had been a strong summer as worries rise about how aggressively the Federal Reserve will raise interest rates to knock down high inflation. Recent comments from some Fed officials have cooled hopes the Fed may end up less forceful than feared.

The yield on the 10-year Treasury has climbed back above 3%, for example, after starting the month close to 2.60%.

Yields calmed on Tuesday, though, which helped give stocks something of a reprieve. The two-year yield fell in particular following some weaker-than-forecast readings on the economy, down to 3.28% from 3.33% late Monday.

The 10-year yield inched up to 3.05% from 3.03% after preliminary data suggested both the manufacturing and services sectors are weaker than economists expected.

“Gathering clouds spread across the private sector as services new orders returned to contractionary territory, mirroring the subdued demand conditions seen at their manufacturing counterparts,” S&P Global Market Intelligence senior economist Siân Jones said in a statement accompanying the report.

A separate report showed that sales of new homes slowed more than economists expected last month. The housing industry has been one of the hardest hit by this year’s turnaround in interest rates. As the Fed has jacked up its key overnight rate, mortgage rates have climbed too and put a chill on the industry.

Such weak data on the U.S. economy raises worries that a recession may indeed be on the way, but it also could encourage the Fed to take it easier on rate hikes. Worries about a slowing economy stretch around the world, and the value of one euro dropped below $1 amid concerns about Europe in particular.

The next big event circled on Wall Street’s calendar is a speech on Friday by Jerome Powell, the chair of the Federal Reserve. He’ll be speaking at an annual symposium held by the Fed in Jackson Hole, Wyoming, which has been the site of major market-moving speeches in the past.

In the stock market, losses for health care companies helped to offset gains for energy producers driven by stronger oil prices.

Several profit reports also drove trading as the earnings season draws to a close. More than 95% of companies in the S&P 500 have reported their earnings for the spring, with overall growth on track for roughly 6%, according to FactSet.

Macy’s rose 3.8% after beating Wall Street’s second-quarter expectations, and J.M. Smucker gained 3.3% after delivering a sweetened financial forecast despite inflation eating into its results. Zoom Video Communications slumped 16.5% after cutting its financial forecast for the year.

Twitter fell 7.3% after a whistleblower alleged the company misled regulators about its cybersecurity defenses, privacy protections and its ability to detect and root out fake accounts. The social media company is in the middle of trying to force Tesla CEO Elon Musk to consummate his $44 billion takeover offer for it.

The Dow Jones Industrial Average fell 154.02, or 0.5%, to 32,909.59, and the Nasdaq composite slipped 0.27, or less than 0.1%, to 12381.30. Stocks of smaller companies held up better than the rest of the market, and the Russell 2000 index ticked up by 0.2%.

 

[bigdog]

Asian stocks mostly higher as markets await Fed chair speech

Asian shares are trading mostly higher as global markets wait for a highly anticipated speech from the U.S.

apnews.com

Stocks edge higher as Wall Street waits for Fed speech​

By STAN CHOE

NEW YORK (AP) — Stocks ticked higher Wednesday as Wall Street waits for a highly anticipated speech about interest rates at the end of the week.

The S&P 500 edged up 12.04 points, or 0.3%, to 4,140.77, as traders overall again held off on making big moves. The Dow Jones Industrial Average added 59.64, or 0.2%, to 32,969.23, and the Nasdaq composite rose 50.23, or 0.4%, to 12,431.53.

It’s the second straight day of modest moves for the market, but they follow some severe swings up and down over the prior weeks.

Stocks drove higher through the summer on hopes that inflation was near its peak and that the Federal Reserve may hike interest rates less aggressively than earlier feared. But recent comments by Fed officials have cooled such expectations, sending Wall Street on Monday to its worst day in months. Discouraging reports on the economy have meanwhile highlighted the risk of a recession.

Wall Street’s focus remains centered on Friday, when Fed Chair Jerome Powell gives a speech at an annual economic conference in Jackson Hole, Wyoming. It’s been the setting for market-moving speeches in the past, which has investors hoping Powell will offer clarity on further rate hikes. Will he be hawkish, which is what traders call a bias toward aggressive rate increases? Or dovish, which is Wall Street-speak for easier conditions?

Brian Jacobsen, senior investment strategist at Allspring Global Investments, doesn’t expect Powell to be clearly one or the other.

“I don’t think he wants to come across as hawkish or dovish, maybe he wants to come across as chicken,” Jacobsen said, citing the many variables that could change the Fed’s thinking before its next meeting on rate policy in September.

Jacobsen warned the speech may be a “nothingburger” with little to chew on, though the market could take that as a positive given some expectations for Powell to sound hawkish.

Higher interest rates slow the economy in hopes of undercutting inflation. But they also risk choking off the economy if done too aggressively, and they pull down prices on all kinds of investments.

Treasury yields have been rising recently, partly in anticipation of the Fed continuing to lean toward raising rates aggressively to quash the worst inflation in decades. The two-year yield, which tends to track expectations for the Fed, rose to 3.40% from 3.30% late Tuesday.

The 10-year yield, which helps set rates for mortgages and many kinds of loans, rose to 3.11% from 3.05% after a report showed that U.S. orders for long-lasting goods were flat in July. Excluding transportation, though, growth was stronger than economists expected.

In the stock market, Intuit rallied 3.6% for one of the larger gains in the S&P 500. The owner of TurboTax delivered stronger results for the latest quarter than expected and forecast revenue for the upcoming fiscal year that topped some analysts’ expectations.

On the losing end were several retailers, which are among the last companies to report how much profit they made during the spring

Nordstrom tumbled 20% after it cut its financial forecast for the year, though it reported stronger profit for the latest quarter than expected. It’s the latest major retailer to say it’s struggling to keep up with its customers’ changing shopping patterns.

Shoppers are shifting their spending away from stores and toward travel and other experiences. The ones still coming through the doors are seeing their buying power undercut by high inflation, with pressure hitting lower-income customers in particular. That has the industry facing mountains of unsold inventory.

Advance Auto Parts slumped 9.6% after its quarterly results fell short of expectations. The car parts chain said its do-it-yourself customers are getting squeezed by high inflation and gasoline prices well above where they were a year ago.

Markets overseas were mixed, with stocks in Shanghai sinking 1.9% but South Korean stocks up 0.5%.

The S&P 500 edged up 12.04 points, or 0.3%, to 4,140.77, as traders overall again held off on making big moves. The Dow Jones Industrial Average added 59.64, or 0.2%, to 32,969.23, and the Nasdaq composite rose 50.23, or 0.4%, to 12,431.53.

 

[bigdog]

Asian stocks follow Wall St higher ahead of Fed chair speech

Asian stock markets have followed Wall Street higher as investors look ahead to a speech by the Federal Reserve chair to shed light on plans for more interest rate hikes.

apnews.com

Wall Street rallies as countdown to Fed speech nears end​

By DAMIAN J. TROISE and STAN CHOE

NEW YORK (AP) — Stocks rallied Thursday as the countdown clicked closer to zero for a highly anticipated speech about interest rates.

The S&P 500 gained 58.35, or 1.4%, to 4,199.12 for its best day in nearly two weeks. Much of the lift came late in the day as traders made moves ahead of Friday morning’s speech by Federal Reserve Chair Jerome Powell, which has long been circled on Wall Street’s calendar.

The Dow Jones Industrial Average rose 322.55, or 1%, to 33,291.78, and the Nasdaq composite climbed 207.74, or 1.7%, to 12,639.27. All three indexes trimmed their losses for the week, caused by Monday’s tumble that was the worst for stocks in months.

Treasury yields eased to let off some of the pressure on Wall Street following the release of several reports on the economy. Fewer workers applied for jobless claims last week than expected, an encouraging sign for a jobs market that has been the main pillar for an economy struggling under high inflation.

A revised reading on the overall economy, meanwhile, suggested that its contraction during the spring wasn’t quite as bad as earlier thought. It shrank 0.6% on an annualized basis, according to the government’s second preliminary reading, milder than the 0.9% given in its initial estimate.

The 10-year Treasury yield, which affects mortgage rates, fell to 3.03% from 3.11% late Wednesday.

That helped stocks that tend to benefit the most from lower interest rates, such as internet and technology companies. Businesses whose profits closely track the strength of the economy, such as producers of raw materials, also helped to lead the market.

Telehealth services providers were strong after Amazon shut down its in-house telemedicine service for employees. Teladoc gained 4%.

On the losing end were several companies that trimmed their financial forecasts for the year. Software company Salesforce fell 3.4%, and discount retailer Dollar Tree fell 10.2%.

Several retailers have cut their outlooks recently, even after reporting stronger profit for the latest quarter than expected. They’re struggling with swelling inventories and higher costs, while their customers likewise get squeezed by inflation, particularly lower-income ones.

Wall Street’s focus, though, remains on Jackson Hole, Wyoming, where economists from around the world are gathering for an annual symposium.

It’s been the setting for market-defining announcements by the Federal Reserve in past years, and investors are hoping Powell will offer some clarity about where interest rates are heading.

The Fed has already raised rates four times this year in its efforts to halt high inflation, with most of them bigger than the usual hike, and investors want to hear how it’s leaning for future increases. Powell will begin speaking at 10 a.m. Eastern time Friday, a half hour after trading begins on Wall Street.

Besides what the Fed will do with its key overnight interest rate, Powell may also talk about how the central bank is putting into reverse the “ money printer ” it used during the pandemic to goose the economy.

Stocks had jumped through the summer on hopes the Fed may go easier on rate hikes than feared, because investors were seeing signs the nation’s high inflation may be peaking. The hope was that the Fed could downshift the size of its rate increases sooner than expected and may not ultimately raise them as far as earlier thought.

But recent comments from a spate of Fed officials have pushed back on that narrative, leading to the hopes for more clarity from Powell on Friday.

Expectations have built among some investors for Powell to sound “hawkish,” which is Wall Street’s euphemism for a bias toward raising rates aggressively. But some investors at the same time are speculating the Fed could turn around quickly and actually begin cutting interest rates in 2023 given mounting pressures on the economy.

“The market is looking for a consistent policy,” Andy Sparks, head of portfolio management research at MSCI, said in a statement. “Raising rates and then allowing the market to believe it may soon begin lowering rates could undermine Fed credibility with market participants.”

Higher interest rates slow the economy in hopes of undercutting inflation. But they also risk choking off the economy if done too aggressively, and they pull down on prices for all kinds of investments.

The S&P 500 gained 58.35, or 1.4%, to 4,199.12 for its best day in nearly two weeks. Much of the lift came late in the day as traders made moves ahead of Friday morning’s speech by Federal Reserve Chair Jerome Powell, which has long been circled on Wall Street’s calendar.

The Dow Jones Industrial Average rose 322.55, or 1%, to 33,291.78, and the Nasdaq composite climbed 207.74, or 1.7%, to 12,639.27. All three indexes trimmed their losses for the week, caused by Monday’s tumble that was the worst for stocks in months.

 

[bigdog]

Dow drops 1,000 after Fed's Powell says rates will stay high

Stocks closed sharply lower after the head of the Federal Reserve dashed Wall Street’s hopes that it may soon ease up on high interest rates in its effort to tame inflation.

apnews.com

Dow drops 1,000 after Fed’s Powell says rates will stay high​

By STAN CHOE, DAMIAN J. TROISE and ALEX VEIGA

NEW YORK (AP) — The Dow Jones Industrial Average sank more than 1,000 points Friday after the head of the Federal Reserve dashed Wall Street’s hopes that it may soon ease up on high interest rates in its effort to tame inflation.

The S&P 500 lost 3.4%, its biggest drop since mid-June, after Jerome Powell said the Fed will likely need to keep interest rates high enough to slow the economy “for some time” in order to beat back the high inflation sweeping the country.

The Dow dropped 3% and the Nasdaq composite ended 3.9% lower, reflecting a broad sell-off led by technology stocks. Higher rates help corral inflation, but they also hurt asset prices.

The Fed has indicated it will raise rates into next year as it tries to quell demand and bring down prices for goods and services. But some investors speculated the central bank might pause or even reverse course next year if inflation subsides, leading to a rally for stocks in July and early August.

Some analysts expected Powell to bat down that talk in Friday’s speech, and he delivered. His speech followed up remarks by several other Fed officials, who also pushed back on speculation the Fed might act less aggressively or even “pivot.”

“He basically said there will be pain and that they won’t stop and can’t stop hiking until inflation moves a lot lower,” said Brian Jacobsen, senior investment strategist at Allspring Global Investments.

Powell acknowledged the increases will hurt U.S. households and businesses, in perhaps an unspoken nod to the potential for a recession. But he also said the pain would be far greater if inflation were allowed to fester and that “we must keep at it until the job is done.”

He was speaking at an annual economic symposium in Jackson Hole, Wyoming, which has been the setting for market-moving Fed speeches in the past.

The sell-off capped a week of choppy trading that left major indexes down 4% or more for the week.

All told, the S&P 500 fell 141.46 points to 4,057.66. The benchmark index is now down almost 15% for the year.

The Dow lost 1,008.38 points to close at 32,283.40. The last time the blue-chip average had a 1,000-point drop was in May.

The Nasdaq slid 497.56 points to 12,141.71, its biggest drop since June.

The Russell 2000 index of smaller companies fell 64.81 points, or 3.3%, to finish at 1,899.83.

Stocks are still showing solid gains for the third quarter, with the S&P 500 up more than 7% and the Nasdaq up 10%. Recent earnings reports were better than some analysts had expected, and there are signs that inflation may have peaked although it remains at sharply elevated levels.

Still, Powell’s speech made clear the Fed will accept weaker growth for a while for the sake of getting inflation under control, analysts said.

“Powell reiterated that the Fed is worried about rising prices, and getting inflation under control is emphatically job number one,” said Jeff Klingelhofer, co-head of investments at Thornburg Investment Management.

Perhaps giving some hope to investors, some analysts said Powell seemed to indicate expectations for future inflation aren’t taking off. If that were to happen, it could cause a self-perpetuating cycle that worsens inflation.

A report on Friday said U.S. consumers are expecting 2.9% annual inflation over the long run, which is at the lower end of the 2.9% to 3.1% range seen in the University of Michigan’s survey over the last year.

For now, the debate on Wall Street is whether the Fed will raise short-term rates by either half a percentage point next month, double the usual margin, or by three-quarters of a point. The Fed’s last two hikes have been by 0.75 points, and a slight majority of bets on Wall Street are favoring a third such increase in September, according to CME Group.

A report Friday morning showed that the Fed’s preferred gauge of inflation decelerated last month and wasn’t as bad as many economists expected. It’s a potentially encouraging signal, which may embolden more of Wall Street to say that the worst of inflation has already passed or will soon.

Other data showed that incomes for Americans rose less last month than expected, while consumer spending growth slowed.

Following the reports and Powell’s comments, the two-year Treasury yield rose for much of the day, but slipped by late afternoon to 3.36% from 3.37% late Thursday. It tends to track expectations for Fed action.

The 10-year Treasury yield, which follows expectations for longer-term economic growth and inflation, initially rose then slipped to 3.02% from 3.03% late Thursday.

The Fed has already hiked its key overnight interest rate four times this year in hopes of slowing the worst inflation in decades. The hikes have already hurt the housing industry, where more expensive mortgage rates have slowed activity. But the job market has remained strong, helping to prop up the economy.

Investors got a fresh set of warnings from companies about the persistent impact from inflation and a slowing economy. Computer maker Dell slumped 13.5% after it said weaker demand will hurt revenue. Chipmaker Marvell Technology fell 8.9% after giving investors a disappointing earnings forecast.

 

[bigdog]

On Friday, the S&P 500 fell 141.46 points to 4,057.66. The benchmark index is now down almost 15% for the year.

The Dow lost 1,008.38 points to close at 32,283.40. The last time the blue-chip average had a 1,000-point drop was in May.

The Nasdaq slid 497.56 points to 12,141.71, its biggest drop since June.

 

[bigdog]

Asian stocks after Wall St pullback on Fed inflation stance

Asian stocks are mixed after Wall Street fell following last week’s Federal Reserve pledge to fight inflation by keeping interest rates elevated.

apnews.com

Wall Street closes lower, adding to last week’s losses​

By DAMIAN J. TROISE and ALEX VEIGA

Stocks closed broadly lower on Wall Street Monday, adding to their hefty losses from last week when the Federal Reserve pledged to keep interest rates high as long as it takes to tame inflation.

The S&P 500 fell 0.7% after wavering between small gains and losses. The Dow Jones Industrial Average fell 0.6% and the Nasdaq composite lost 1%. Smaller company stocks also fell, pulling the Russell 2000 0.8% lower.

The selling was widespread, with technology and health care stocks among the biggest weights on the market. Only energy and utilities stocks rose.

The market is coming off its worst weekly pullback since mid-June after Fed chief Jerome Powell indicated on Friday that the central bank will raise rates into next year and keep them elevated as it tries to quell demand and bring down prices for goods and services.

The open-endedness implied by how long the Fed may have to keep raising rates has, for now, quieted speculation on Wall Street that recent data showing more moderate inflation would prompt the central bank to act less aggressively.

“We’re in this period where you’re going to see volatility be more of the norm versus the exception and will probably continue until, frankly, inflation gets under control and that then sets the motion for the Fed to become a little bit more dovish,” said Terry Sandven, chief equity strategist at U.S. Bank Wealth Management.

The Fed’s last two hikes have been by 0.75 points, and Wall Street is expecting a third such increase in September, according to CME Group. Some investors had hoped that the Fed would ease up on rate hikes into next year if inflation subsides. That sentiment led to a rally for stocks in July and early August. All three major indexes are now lower this month.

On Monday, the S&P 500 fell 27.05 points to 4,030.61. The benchmark index fell 3.4% Friday, its biggest single-day drop since mid-June.

The Dow dropped 184.41 points to 32,098.99, while the Nasdaq slid 124.04 points to 12,017.67. The Russell 2000 gave up 16.89 points to 1,882.94.

Technology stocks, among the biggest decliners so far this year, led the way lower. Apple fell 1.4%.

Health care stocks also lost ground. Drug delivery technology company Catalent slumped 7.4% for the biggest drop in the S&P 500 after giving investors a disappointing revenue forecast.

Energy stocks made gains as U.S. crude oil prices rose 4.2%. Exxon Mobil rose 2.3%.

The yield on the 10-year Treasury, which follows expectations for longer-term economic growth and inflation, rose to 3.11% from 3.03% late Friday. The yield on the two-year Treasury, which tends to track expectations for Fed action, rose to 3.43% from 3.38%.

Investors have been closely watching economic reports to get a better sense of how much the economy is slowing and whether inflation is starting to cool from the hottest levels in four decades.

The Fed’s preferred gauge of inflation decelerated last month, while other data shows consumer spending slowed. Wall Street will get several more updates on the economy this week.

The Conference Board will release its latest reading on consumer confidence on Tuesday.

The government will release its closely watched monthly jobs report on Friday. The employment market has remained resilient amid a broader slowdown for the economy. That has helped temper worries that the U.S. is facing a potential recession.

European markets also closed lower and Asian markets closed lower overnight. Chinese economic data showing a drop in industrial profits indicated that a strong recovery there will take time, amid fresh COVID-19 restrictions.

The S&P 500 fell 0.7% after wavering between small gains and losses. The Dow Jones Industrial Average fell 0.6% and the Nasdaq composite lost 1%. Smaller company stocks also fell, pulling the Russell 2000 0.8% lower.

 

[bigdog]

My apologies for not being able to post today

Can only access with my phone

 

[bigdog]

Skate could you please make the posting for me today

 

[Skate]

Stocks tumble again as Tuesday's market rally was brief
Stocks opened higher but quickly gave up their gains. A more than 5% drop in oil prices, while welcome news to consumers, led to a big sell-off in energy stocks. The Dow tumbled nearly 310 points or 1%. Shares of Chevron (CVX), a Dow component, fell more than 2%. The S&P 500 was down 1.1% and oil stocks were the biggest losers. The S&P Energy Select Sector SPDR Fund (XLE) slid 3.4%.

The entire market was reeling Tuesday
The Nasdaq, home to many top tech stocks, fell 1.1% as well. Stocks suffered their third straight day of losses. Investors are still dealing with the aftermath of Federal Reserve chair Jerome Powell's speech at Jackson Hole on Friday, which led to a more than 1,000 point plunge in the Dow. The market was expecting some might say hoping that Powell would signal that the Fed was becoming less concerned about inflation, which would have been a possible sign that the central bank won't raise rates too aggressively at its September 21 meeting. But Powell instead talked about how continued rate hikes were still necessary to fight inflation, even if that meant "some pain" for consumers and businesses. As such, traders are now anticipating another three-quarter of a percentage point rate hike next month.

Market volatility is taking place during a notoriously quiet time on Wall Street
Trading volume is light as many investors are enjoying their last bits of summer vacation. What's more, there isn't a lot of economic or earnings data to move stocks right now. The numbers that did come out Tuesday were not too bad. Retailer sales were better than expected. US companies still have more job openings and consumer confidence actually rose in August.

But good news can sometimes be viewed as bad news on Wall Street
Any signs that the economy may be holding up better than thought and not heading toward a significant downturn will likely be interpreted as inflationary which means more big rate hikes could be coming. "Normally, seeing companies wanting to hire more workers is a good thing. However, after Fed Chair Powell's short Jackson Hole speech myopically focused on reducing demand and jobs, more jobs are more reason for the Fed to raise rates," Bryce Doty, senior portfolio manager with Sit Fixed Income Advisors, said in an email.

Friday's jobs report
With all that in mind, investors will be paying extremely close attention to Friday's jobs report. Economists expect that 300,000 jobs were added in August. Although that would be a slowdown from the 528,000 added in July, it's still a healthy gain for the nation's payrolls and would not be considered a harbinger of recession.

ASX Market Watch
Australian shares are set to open down as the fallout continued on Wall Street overnight.
The ASX / SPI 200 is pointing down to 6,860.000 or -58 points.

Skate.

 

[bigdog]

Asian shares track Wall Street slide on expected rate raises

Asian shares are trading mostly lower, tracking the broad slide on Wall Street, as investors braced for higher interest rates and inflation worries for some time.

apnews.com

Stocks end lower in choppy trading, on pace for weekly loss​

By ALEX VEIGA

A choppy day of trading ended Wednesday with a broad slide for stocks as Wall Street closed the books on a rocky August that started off strong, but wound up leaving the market deeper in the red for the year.

The S&P 500 fell 0.8%, extending its losing streak to a fourth day. The benchmark index ended the month with a 4.2.% loss after surging 9.1% in July.

The Dow Jones Industrial Average fell 0.9%, while the Nasdaq composite slid 0.6%. The major stock indexes are on pace for weekly losses.

Technology stocks and big retailers were among the heaviest weights on the market. Only communications stocks eked out a slight gain. Smaller company stocks also fell, pulling the Russell 2000 index 0.6% lower.

The latest pullback for stocks came as Treasury yields rose broadly. The yield on the 10-year Treasury, which influences interest rates on mortgages and other consumer loans, rose to 3.17% from 3.11% late Tuesday.

Bond yields have been rising along with expectations for higher interest rates, which the Federal Reserve has been increasing in a bid to squash the highest inflation in decades.

“You have the bond market now taking the Fed seriously,” said Willie Delwiche, investment strategist at All Star Charts. “And it’s not that stocks can’t overcome that, but so far they haven’t overcome that.”

The last time stocks mounted a big rally was in July and early August, when bond yields came off their highs as expectations for higher rates eased.

“If the underlying trend in stocks is lower, then higher bond yields weigh on that,” Delwiche said.

The S&P 500 fell 31.16 points to 3,955. The index is now down 17% so far this year.

The Nasdaq lost 66.93 points to 11,816.20, while the Dow gave up 280.44 points to close at 31,510.43. The Russell fell 11.48 points to 1,844.12.

Stocks got off to a solid start in early August, continuing a July rally. Investors were encouraged to see that signs that inflation, while still high, was leveling off. That fueled optimism on Wall Street that the Federal Reserve might be able to ease back on raising interest rates, its main weapon in its fight to bring inflation down. Those gains followed a weak first half of the year where the S&P 500 dropped 20% from its most recent high and entered a bear market.

That optimism faded by mid-August as the central bank signaled it would keep raising rates and keep them high as long as necessary to tame the the hottest inflation in four decades. On Friday, Federal Reserve Chairman Jerome Powell underscored the Fed’s intention in a speech at the central bank’s annual symposium.

Wall Street is worried that the Fed could hit the brakes too hard on an already slowing economy and veer it into a recession. Higher interest rates also hurt investment prices, especially for pricier stocks like technology companies.

Traders are now trying to get a better sense of how far and how quickly the Fed’s rate hikes will go, beginning with the central bank’s upcoming interest rate policy meeting September 20-21. The Fed has already raised interest rates four times this year and is expected to raise short-term rates by another 0.75 percentage points at its September meeting, according to CME Group.

Investors have been closely watching economic data for any additional signs that the economy is slowing down or that inflation may be cooling or at least holding at its current level. Businesses and consumers have been hit hard by rising prices on everything from food to clothing, but recent declines in gasoline prices have provided some relief.

Strong U.S. employment data have helped fuel expectations of more interest rate hikes. The Labor Department reported Tuesday there were two jobs for every unemployed person in July, giving ammunition to Fed officials who argue the economy can tolerate more rate hikes to tame inflation that is at multi-decade highs.

On Wednesday, payroll processor ADP said its latest monthly survey of hiring by private U.S. companies showed payrolls increased by 132,000, well below the 275,000 economists expected, according to FactSet.

The ADP survey comes ahead of employment reports from the Labor Department this week: applications for unemployment benefits on Thursday and the August jobs report Friday. Analysts expect both to show a robust labor market.

Technology stocks and big retailers were among the heaviest weights on the market Wednesday. Chipmaker Nvidia fell 2.4% and Best Buy slid 5.6%. Energy companies fell as the price of U.S. crude oil dropped 2.3%. Occidental Petroleum slipped 1.4%.

Those losses kept gains in communications stocks and elsewhere in the market in check.

Bed Bath & Beyond sank 21.3% after announcing a major restructuring and a stock sale, while Snap, the operator of the Snapchat messaging app, jumped 8.7% after announcing it will lay off 20% of its work force.

The S&P 500 fell 31.16 points to 3,955. The index is now down 17% so far this year.

The Nasdaq lost 66.93 points to 11,816.20, while the Dow gave up 280.44 points to close at 31,510.43. The Russell fell 11.48 points to 1,844.12.

Thank you Skate for yesterday

 

[bigdog]

Asian stock markets mixed ahead of latest US jobs reading

Asian stock markets are mixed ahead of U.S. jobs data as investors that might influence Federal Reserve plans for more interest rate hikes to cool surging inflation.

apnews.com

Stocks end mixed on Wall Street, S&P 500 ekes out a gain​

By ALEX VEIGA

A late burst of buying erased some of the stock market’s losses Thursday, leaving indexes mixed on Wall Street though still on pace to end lower for the week.

The S&P 500 rose 0.3% after having been down 1.3% earlier in the day. The benchmark index’s positive turn in the last 10 minutes of trading ended a four-day losing streak.

The Dow Jones Industrial Average also bounced back from an early slide to finish with a 0.5% gain, while the tech-heavy Nasdaq composite fell 0.3%. Several measures of small and mid-size companies also lost ground, including the Russell 2000, which closed 1.2% lower.

The mixed finish for stocks comes as traders look ahead to the Labor Department’s latest monthly job market snapshot Friday. The Federal Reserve will consider the August update on job and wage growth as it determines further interest rate hikes in its bid to slow the economy enough to bring down inflation.

“We’ll be able to get a better read on markets tomorrow after that number comes out,” said Sameer Samana, senior global market strategist at Wells Fargo Investment Institute. “At least right now, the path of least resistance for markets remains lower.”

The S&P 500 rose 11.85 points to 3,966.85, while the Dow added 145.99 points to 31,656.42. The Nasdaq slid 31.08 points to 11,785.13, its fifth straight drop. The Russell 2000 index of smaller companies fell 21.30 points to 1,822.82.

Gains in health care stocks, companies that rely on direct consumer spending and communications services providers helped lift the market. Johnson & Johnson rose 2.5%, Target gained 2.8% and Netflix added 2.9%.

Technology stocks were once again one of the heaviest weights on the market. Nvidia dropped 7.7% after the chipmaker said the U.S. government imposed new licensing requirements on its sales to China.

Energy stocks fell as the price of U.S. crude oil, which is coming off its third month of declines, dropped 3.3% to $86.61 a barrel. Chevron slid 1.6%.

Major indexes in Europe and Asia closed lower.

Treasury yields rose. The yield on the 10-year Treasury, which influences interest rates on mortgages and other consumer loans, rose to 3.26% from 3.20% late Wednesday. The two-year Treasury yield, which tends to track expectations for Fed action, rose to 3.52% from 3.50% and is now at the highest level since 2007.

Bond yields have been rising along with expectations for higher interest rates, which the Federal Reserve has been increasing in a bid to squash the highest inflation in decades.

Stocks have been mostly racking up losses in recent weeks, wiping out much of the gains the market made in July and early August. Traders remain remain wary of how the economy will hold up as the Fed ratchets up interest rates to fight inflation.

The selling accelerated beginning last week, when Federal Reserve Chairman Jerome Powell indicated that the central bank will likely need to keep interest rates high enough to slow the economy “for some time” in order to bring inflation down.

The Fed has already raised interest rates four times this year and is expected to raise short-term rates by another 0.75 percentage points at its next meeting later this month, according to CME Group.

Wall Street is worried that the Fed could hit the brakes too hard on an already slowing economy and veer it into a recession. Higher interest rates also hurt investment prices, especially for pricier stocks like technology companies.

The S&P 500 ended August with a 4.2% loss after surging 9.1% in July on optimism that the Fed might be able to ease back on raising rates following signs that inflation, while still high, was leveling off.

The July and early August market rally marked a brief positive turn for Wall Street after a weak first half of the year where the S&P 500 dropped 20% from its most recent high and entered a bear market. September may not offer much of a respite for investors, as historically it tends to be the worst month for stocks.

Investors have been closely watching economic data for any additional signs that the economy is slowing down or that inflation may be cooling or at least holding at its current level. Businesses and consumers have been hit hard by rising prices on everything from food to clothing, but recent declines in gasoline prices have provided some relief.

Strong U.S. employment data have helped fuel expectations of more interest rate hikes. The Labor Department reported Tuesday there were two jobs for every unemployed person in July, giving ammunition to Fed officials who argue the economy can tolerate more rate hikes to tame inflation that is at multi-decade highs.

On Thursday, the Labor Department said applications for unemployment benefits fell last week, the latest sign the job market continues to shine despite a slowing U.S. economy.

The S&P 500 rose 11.85 points to 3,966.85, while the Dow added 145.99 points to 31,656.42. The Nasdaq slid 31.08 points to 11,785.13, its fifth straight drop. The Russell 2000 index of smaller companies fell 21.30 points to 1,822.82

 

[bigdog]

Stocks shed early gains, end lower for 3rd straight week

Stocks gave up an early rally and ended lower on Wall Street, marking their third losing week in a row.

apnews.com

U.S. stock markets will be closed Monday for the Labor Day holiday.

Stocks shed early gains, end lower for 3rd straight week​

By ALEX VEIGA

Stocks gave up an early rally and closed lower Friday, marking their third losing week in a row and extending Wall Street’s late-summer slump.

Major stock indexes initially climbed broadly following the government’s latest job market report, which showed employers slowed their hiring in August. The report put traders in a buying mood, stoking cautious optimism that the Federal Reserve may not need to raise interest rates as aggressively in its ongoing bid to tame inflation.

But the market reversed course by mid-afternoon, shedding all its gains. That left the S&P 500 and Dow Jones Industrial Average 1.1% lower. The Nasdaq composite fell 1.3%.

“The jobs report today was nice, but it was not enough to obviously sustain the rally,” said Ross Mayfield, investment strategist at Baird. “The bar to clear is ‘does this change the trajectory of the Fed?’ And I don’t know that this report is enough to say yes.”

In recent weeks, the market has wiped out much of the gains it made in July and early August as traders worried that the Fed would not let up anytime soon on raising interest rates to bring down the highest inflation in decades.

The latest jobs data appeared to give traders some hope that a key driver of inflation is cooling. On Friday, the Labor Department reported that the U.S. economy added 315,000 jobs last month, down from 526,000 in July and below the average gain of the previous three months. The unemployment rate also rose to 3.7% from 3.5% in July.

Average hourly pay jumped 5.2% last month from a year earlier, but slowed slightly from July to August. That’s a welcome sign in the inflation fight, as businesses typically pass the cost of higher wages on to their customers through higher prices.

”Today’s jobs report was a step in the right direction, in that the pace of job and wage growth stabilized,” said Matt Peron, director of Research at Janus Henderson Investors. “However, we reiterate our caution that we are not out of the woods just yet, as stubbornly high wage gains could keep the Fed on an aggressive path.”

The Fed has already raised interest rates four times this year and is expected to raise short-term rates by another 0.75 percentage points at its next meeting later this month, according to CME Group. Following the jobs report, expectations for that three-quarter percentage point hike fell to 56% from 75% on Thursday.

Market watchers such as David Kelly, chief global strategist at J.P. Morgan Asset Management, said they still expect the central bank to raise rates later this month by another 0.75 percentage points.

Signs of some slack in the labor market as well as more welcome news on falling gas prices “increase the odds that the economy could gradually return to milder inflation over the course of the next year without falling into recession,” Kelly said.

Stocks entered a skid last week after Chair Jerome Powell said the Fed needs to keep rates elevated enough “for some time” to slow the economy.

“The Fed is not going to be swayed by one or two pieces of data, and they are steadfast about getting inflation down,” Mayfield said. “They need a really broad and long body of evidence before they’re going to pivot because the last thing they want is to quit too early.”

The latest jobs data comes a day after the Labor Department reported unemployment claims fell last week in another sign of a strong job market. It said earlier this week there were two jobs for every unemployed person in July.

The Fed will also get to review upcoming reports on consumer prices and inflation at the wholesale level, among other economic reports, before its next interest rate policy meeting.

Friday’s afternoon market reversal followed an announcement by Russian state-run energy giant Gazprom that a halt in natural gas supply through the Nord Stream 1 pipeline to Germany may be prolonged. The company cited the need for urgent maintenance work on the pipeline. On Wednesday, Gazprom completely halted the flow of gas through the pipeline and said the stoppage would last for three days.

Treasury yields, which have been rising along with expectations for higher interest rates, fell broadly. The yield on the 10-year Treasury, which influences interest rates on mortgages and other loans, slipped to 3.20% from 3.26% late Thursday. The two-year Treasury yield, which tends to track expectations for Fed action, fell to 3.40% from 3.52%.

U.S. stock markets will be closed Monday for the Labor Day holiday.

 

[bigdog]

U.S. stock markets will be closed Monday for the Labor Day holiday.

The S&P 500 and Dow Jones Industrial Average was 1.1% lower. The Nasdaq composite fell 1.3%.

 

[bigdog]

U.S. stock markets WAS closed Monday for the Labor Day holiday.

Global stocks sink as Europe faces new squeeze on gas supply

BEIJING (AP) — Global stock markets sank Monday as Europe faced a new squeeze on Russian gas supplies. London and Frankfurt opened lower. Tokyo, Hong Kong and South Korea fell while Shanghai gained.

apnews.com

Global stock markets sank Monday as Europe faced a new squeeze on Russian gas supplies.

London and Frankfurt opened lower. Tokyo, Hong Kong and South Korea fell while Shanghai gained. Oil prices rose more than $2 per barrel while the euro edged lower.

Markets were roiled by Russian energy giant Gazprom’s announcement Friday that a suspension of gas supplies through the Nord Stream 1 pipeline would be extended indefinitely. That adds to shortages in Germany and other economies.

In early trading, the FTSE 100 in London lost 1.1% to 7,198.73 and the DAX in Frankfurt tumbled 3.2% to 12,628.44., The CAC 40 in France fell 2% to 6,047.28.

Gazprom’s announcement puts European stocks under “heavy pressure,” said Chris Turner of ING in a report.

Also Friday, U.S. government data showed hiring slowed in August but wages rose sharply. Forecasters said the Federal Reserve might see that as evidence more interest rate hikes are needed to bring down inflation that is at a four-decade high.

“Markets relinquished early optimism for a sense of foreboding,” said Tan Boon Heng of Mizuho Bank in a report.

On Wall Street, the S&P 500 future was off less than 0.1%. That for the Dow Jones Industrial Average gained less than 0.1%.

The Dow also fell 1.1% on Friday after the Labor Department reported the U.S. economy added 315,000 jobs in August. That was down from July’s 526,000, but average hourly pay jumped by an unusually wide margin of 5.2% compared with a year earlier.

The Nasdaq composite lost 1.3%.

In Asia, the Shanghai Composite Index advanced 0.4% to 3,199.91 after the Chinese government tightened controls on movement in the southern business center of Shenzhen following virus outbreaks.

The Nikkei 225 in Tokyo lost 0.1% to 27,619.61 while the Hang Seng in Hong Kong tumbled 1.2% to 19,225.70.

The Kospi in Seoul lost 0.2% to 2,403.68 while Sydney’s S&P-ASX 200 added 0.3% to 6,852.20.

New Zealand and Bangkok declined while Singapore and Jakarta advanced.

European economies face gas shortages after their governments agreed to wind down purchases from Russia to punish the Kremlin for invading Ukraine.

Last week, state-owned Gazprom announced a three-day suspension of gas supplies through Nord Stream 1 due to urgent maintenance work.

On Friday, the company said that would be extended indefinitely. Russia already has reduced supplies to countries that sided with Ukraine.

Meanwhile, traders are uneasily watching the Fed after chair Jerome Powell said Aug. 26 interest rates have to stay elevated to rein in surging inflation. That dashed hopes the Fed might back off due to signs U.S. economic activity is cooling.

The Fed has raised rates four times this year, twice by 0.75 percentage points, triple its usual margin.

Central banks in Europe and Asia also have hiked rates, fueling worries they might derail global economic growth.

The U.S. market has given up much of the gains made in July and August when traders hoped the Fed might ease up.

Traders expect another 0.75 percentage point rate hike at this month’s Fed meeting, according to CME Group.

In energy markets, benchmark U.S. crude gained $2.18 to $89.05 per barrel in electronic trading on the New York Mercantile Exchange. The contract rose 26 cents to $86.87 on Friday. Brent crude, the price basis for international oil trading, added $2.54 to $95.56 per barrel in London. It advanced 66 cents the previous session to $93.02.

The dollar advanced to 140.50 yen from Friday’s 140.13 yen. The euro declined to 99.26 cents from 99.64 cents.

U.S. stock markets WAS closed Monday for the Labor Day holiday.

Rest of world trading

 

[bigdog]

Asian shares decline on Wall Street losses, rate worries

Asian shares are mostly lower, as pessimism prevailed about higher interest rates ahead and Wall Street shares fell for the fourth straight week.

apnews.com

Stocks drift lower, extending losses into 4th straight week​

By DAMIAN J. TROISE and ALEX VEIGA

Stocks closed lower on Wall Street Tuesday, extending the market’s losses into a holiday-shortened week.

The S&P 500 fell 0.4% after bouncing between a gain of 0.5% and a loss of 1%. The Dow Jones Industrial Average fell 0.6% and the Nasdaq lost 0.7%.

The major indexes are coming off their third losing week in a row, part of a late-summer slump that erased much of the benchmark S&P 500′s gains from July and early August.

Stocks have been losing ground as the Federal Reserve has indicated it will not let up anytime soon on raising interest rates to bring down the highest inflation in decades.

In addition, Wall Street is grappling with worries about a brewing energy crisis in Europe and the implications it could have for the global economy and corporate profits, given that companies in the S&P 500 get half their revenue from abroad, said Michael Antonelli, market strategist at Baird.

“Each day that goes by that we have to talk about an energy crisis or a gas shortage or out of control electrical bills in Europe, the less the market can make constructive headway,” he said.

The S&P 500 fell 16.07 points to 3,908.19. The Dow slid 173.14 points to 31,145.30, while the Nasdaq fell 85.96 points to 11,544.91.

Smaller company stocks fell more than the broader market. The Russell 2000 index fell 17.42 points, or 1%, to 1,792.32.

Technology and communications stocks were among the biggest losers. Intel fell 2.8% and Netflix dropped 3.4%.

Bed Bath & Beyond fell 18.4% following the death of its chief financial officer. The company has been suffering from a prolonged sales slump and executive turnover.

The company that wants to take Trump Media public, Digital World Acquisition, plunged 11.4% following reports it didn’t receive enough shareholder support for an extension to close the deal.

ADT rose 16.4% after State Farm said it was taking a 15% stake in the home security company.

Markets in the U.S. were closed on Monday for the Labor Day holiday.

Trading began Tuesday at the New York Stock Exchange after Ukrainian President Volodymyr Zelenskyy virtually rang the opening bell. He gave a pitch for a program to attract large-scale investments to his country as it continues to battle Russian forces.

Markets have been slipping in recent weeks as inflation remains hot and the Federal Reserve stays on track to continue raising interest rates to try and tame stubbornly persistent high prices. The big concern is that the Fed might go too far in raising rates and slam the brakes too hard on an already slowing economy, potentially causing a recession.

Wall Street has been closely watching economic data for clues that inflation might be easing, which traders hope will give the Fed a reason to ease up on rate hikes. The Fed has already raised interest rates four times this year and is expected to raise short-term rates by another 0.75 percentage points at its next meeting later this month, according to CME Group.

“There’s a fairly consensus view now that the Fed is going to be higher for longer and err on the side of inflation reduction over employment and growth,” said Mark Hackett, chief of investment research at Nationwide.

Bond yields rose. The yield on the 10-year Treasury, which influences interest rates on mortgages and other loans, rose to 3.34% from 3.19% late Thursday. The two-year Treasury yield, which tends to track expectations for Fed action, rose to 3.51% from 3.39%

The S&P 500 fell 16.07 points to 3,908.19. The Dow slid 173.14 points to 31,145.30, while the Nasdaq fell 85.96 points to 11,544.91.