Today’s Stock Market: Wall Street Declines Prior to Crucial Job Market Reports
The stock market experienced a decline on Monday in Wall Street in anticipation of upcoming reports on the job market, which could potentially offer further understanding of the Federal Reserve’s considerations regarding interest rates.
The S&P 500 dropped by 0.9%. This index just had its strongest month in over a year and hit a record high on Friday.
At 11:20 a.m. Eastern, the Dow Jones Industrial Average decreased by 150 points, or 0.4%, to 36,097. The Nasdaq composite also saw a decline of 1.5%.
The increase in Treasury yields caused some strain on stock prices. The yield for the 10-year Treasury, which has an impact on mortgage rates, went up to 4.29% from 4.21%.
Technology companies were among the biggest weights on the market. Microsoft fell 2.6% and Apple fell 1.8%.
After unveiling its third set of job cuts in 2020, Spotify saw a 7% increase in stock value. Uber also experienced a boost, with a 5.6% gain, after being added to the S&P 500 index as a ride-hailing company.
Alaska Air Group’s stock dropped by 15.6% following the announcement of its purchase of Hawaiian Airlines in a $1.9 billion agreement. This merger could potentially challenge the Biden administration’s efforts to prevent consolidation within the airline industry.
Crude oil prices in the United States dropped by 0.3%. There has been a recent decline in oil prices, which has helped to alleviate inflation concerns.
Stock markets experienced a combination of gains and losses in both Europe and Asia.
Wall Street is coming off a solid week and a strong November on hopes that inflation is easing enough to allow the Federal Reserve to stop raising interest rates. Investors are also hoping that the economy remains strong enough to avoid a recession.
This week, investors can expect important updates regarding the economy, such as reports on the services industry and employment.
On Tuesday, the Institute for Supply Management will publish its November findings about the services industry. This sector plays a crucial role in the US economy and contributes to most of the country’s employment. The report may offer further understanding of consumer spending and the job market.
This week, Wall Street will receive multiple reports pertaining to the overall state of employment in the United States. On Tuesday, the government will publish its October findings on job opportunities, followed by a weekly report on unemployment benefit applications on Thursday.
Investors will be paying close attention to the government’s employment report for November, scheduled for release on Friday. According to a survey conducted by FactSet, analysts anticipate an increase of 175,000 jobs in the U.S. last month. They predict that the unemployment rate will remain unchanged at 3.9%.
Despite the Federal Reserve’s efforts to combat inflation by slowing down the overall economy through sharp interest rate increases, the labor market in the United States has remained robust. In fact, inflation has been on a downward trend since mid-2022, leading the central bank to pause its rate hikes after its latest one in late July.
According to Wall Street, interest rates are predicted to stay constant until early 2024. At this time, the Fed may start decreasing interest rates from their current highest point in the past twenty years. The Fed’s upcoming rate decision will occur after their two-day meeting on December 13th.