Wall Street Dips as Weak Labor Market Data Sparks Economic Concerns

Wall Street ends slightly down after weak labor market data, dovish Fed comments

NEW YORK - U.S. stocks finished slightly lower in choppy trading on Wednesday following labor market data and comments from a Federal Reserve official that bolster the case for an interest rate cut. Labor Department data showed that U.S. job openings fell to a three-and-a-half-year low in July, indicating continued easing of labor market tightness that could strengthen the Fed's hand to begin cutting rates at its next meeting later this month. The benchmark S&P 500 and Nasdaq edged to a lower close while the Dow ended slightly higher. Utilities and consumer staples stocks led the gainers while energy and technology equities were the main drag. Six out of 11 S&P 500 sectors ended lower. "This is always a rocky period in September but the economy is holding up," said Bill Strazzullo, chief markets strategist at Bell Curve Trading in Boston. "The consumer is fine, the labor market is fine. I'm still bullish overall." Shares of Nvidia, which suffered a massive $279 billion drop in market value on Tuesday, closed 1.7% lower. Shortly before the close of trading, the company denied a media report that it received a subpoena from the U.S. Department of Justice. Other megacap growth stocks fell, including Apple which ended 0.9% lower. Microsoft dipped 0.1%, Alphabet dropped 0.5% and Amazon.com slipped 1.7%. Tesla shares rose 4.2%. Raphael Bostic, Atlanta Fed president, said on Wednesday the central bank must not keep interest rates too high much longer or it risks causing too much harm to employment. He added that waiting until inflation falls back to the Fed's 2% goal before cutting rates "would risk labor market disruptions that could inflict unnecessary pain and suffering." In the previous day's session, all three Wall Street indexes slumped to their biggest one-day loss since early August as investors dumped technology-related stocks in a dour start to September ‒ which is historically the worst month for equities. "Utility stocks are up today because of weak data in jobs that just bolsters the case that when the Fed meets in about two weeks they are going to cut rates by at least 25 basis points," said Eric Beyrich, co-chief investment officer at Sound Income Strategies. The Dow Jones Industrial Average rose 38.04 points, or 0.09%, to 40,974.97, the S&P 500 lost 8.86 points, or 0.16%, to 5,520.07 and the Nasdaq Composite lost 52.00 points, or 0.30%, to 17,084.30. The Philadelphia SE Semiconductor index rebounded from its biggest one-day drop since the COVID-19 pandemic in the previous session and ended up 0.25%. Advanced Micro Devices rose nearly 3% after it named former Nvidia executive Keith Strier as senior vice president of global AI markets. Zscaler fell nearly 19% after the company forecast fiscal 2025 revenue and profit below estimates. Dollar Tree slumped 22% after the discount store operator trimmed its annual sales and profit forecasts. Nvidia shares:Chip stocks waver after previous day's sell-off Total volume across U.S. exchanges was about 10.5 billion shares, down from a 20-day moving average of nearly 11 billion shares.

Wall Street ends slightly down after weak labor market data, dovish Fed comments

U.S. stocks finished slightly down in choppy trading on Wednesday following labor market data and comments from a Federal Reserve official that bolster the case for an interest rate cut. Labor Department data showed that U.S. job openings fell to a 3-1/2-year low in July, indicating continued easing of labor market tightness that could strengthen the Fed's hand to begin cutting rates at its next meeting later this month. "This is always a rocky period in September but the economy is holding up," said Bill Strazzullo, chief markets strategist at Bell Curve Trading in Boston. "The consumer is fine, the labor market is fine. I'm still bullish overall." Shares of Nvidia, which suffered a massive $279 billion drop in market value on Tuesday, lost ground. The U.S. Department of Justice sent a subpoena to the AI chip firm as it deepens its probe into the company's antitrust practices, according to a report. Other megacap growth stocks including Apple and Amazon.com slipped. Tesla shares rose. Raphael Bostic, Atlanta Fed president, said on Wednesday the central bank must not keep interest rates too high much longer or it risks causing too much harm to employment. He added that waiting until inflation falls back to the Fed's 2% goal before cutting rates "would risk labor market disruptions that could inflict unnecessary pain and suffering." In the previous day's session, all three Wall Street indexes slumped to their biggest one-day loss since early August as investors dumped technology-related stocks in a dour start to September - which is historically the worst month for equities. "Utility stocks are up today because of weak data in jobs that just bolsters the case that when the Fed meets in about two weeks they are going to cut rates by at least 25 basis points," said Eric Beyrich, co-chief investment officer at Sound Income Strategies. According to preliminary data, the S&P 500 lost 10.25 points, or 0.19%, to end at 5,518.68 points, while the Nasdaq Composite lost 53.96 points, or 0.31%, to 17,082.34. The Dow Jones Industrial Average rose 31.44 points, or 0.08%, to 40,968.37. Advanced Micro Devices rose after it named former Nvidia executive Keith Strier as senior vice president of global AI markets. Zscaler fell sharply after the company forecast fiscal 2025 revenue and profit below estimates. Dollar Tree slumped after the discount store operator trimmed its annual sales and profit forecasts.

Wall St. ends mostly down after weak labor market data

STORY: U.S. stocks closed mostly lower in choppy trading on Wednesday following data that showed more weakness in the U.S. labor market. The Dow ticked up marginally, while the S&P 500 and the Nasdaq both ended slightly down. A report from the Labor Department showed job openings fell to a 3-1/2-year low in July, likely strengthening the case for an interest rate cut from the Federal Reserve after its policy meeting later this month. This comes ahead of August's nonfarm payrolls, released Friday, which is also expected to show further cooling of the labor market. Dan Eye is chief investment officer at Fort Pitt Capital Group. "We think it's important for investors to really realize that that we don't get to the point where the Fed can cut interest rates or normalize interest rates, where we can get inflation back in the box, you know, back in line with with long term trend levels, if you know the economy is still growing at 3 plus percent, if we're still adding 250-and 300 thousand jobs to the payroll every month. So we think we're in this last leg of the normalization process that frankly, you know really, really needs to happen and you know a slowing economic backdrop is certainly part of that process." Stocks on the move included Nvida, down more than 1.5% a day after a roughly 10% drop. The U.S. Justice Department sent a subpoena to the AI chip firm as it deepens its probe into the company's antitrust practices, according to a report. Fellow chipmaker Advanced Micro Devices rose nearly 3% after it named a former Nvidia executive as senior vice president of global AI markets. Stocks of other tech firms including Apple and Amazon slipped, while Tesla shares rose more than 4%. One non-tech stock of note... Dollar Tree which plummeted more than 22% after the discount store operator trimmed its annual sales and profit forecasts.