2023-10-03 23:30:47
The Dow Jones New York Stock Exchange index closed down more than 400 points on Tuesday (Oct. 3) following the United States revealed higher-than-expected job opening numbers. This has led the market to worry that the data will push the Federal Reserve (Fed) to keep interest rates high for a long time.
The Dow Jones Industrial Average closed at 33,002.38 points, down 430.97 points or -1.29%, the S&P 500 Index closed at 4,229.45 points, down 58.94 points or -1.37%, and the Nasdaq Index closed at 13,059.47 points, down 248.31 points or -1.87%.
The Dow Jones and Nasdaq index both closed at their lowest levels since May 31, while the S&P 500 closed at their lowest level since June 1 following the US survey of job openings and employment rates was released. Labor turnover (JOLTS), which found that the number of job openings which is a measure of demand in the labor market rose nearly 700,000 jobs to 9.61 million jobs in August. This is the highest level since April. and higher than analysts’ estimates of 8.8 million positions.
The JOLTS number is information that the Fed is interested in. It is viewed as a measure of tightness in the labor market. which is a factor in considering monetary policy and the Fed’s interest rates
Rick Meckler, an analyst at Cherry Lane Investments, said the data has investors worried. The Fed may raise interest rates once more. and hold interest rates at a high level for a longer time This will cause borrowing costs to increase. and affecting both the business sector and consumer groups.
After the US released the JOLTS numbers, investors gave 34.9% weight to the Fed to raise interest rates by 0.25% to 5.50-5.75% at the November meeting. This increased from 16.4% last week. It also resulted in the CBOE Volatility Index (VIX), which is a measure of investor anxiety in the US stock market. It rose to the highest level since May 24 of this year.
The market was also pressured by the US 10-year Treasury yield rising to a 16-year high and Fed officials remaining supportive of rate hikes. Most recently, Ms. Loretta Mester, president of the Cleveland Fed, said: The Fed needs to raise interest rates one more time this year and keep them there for some time. This is because inflation remains high.
Ten of the 11 stocks in the S&P 500 closed in negative territory, led by luxury goods and technology stocks.
Amazon shares fell 3.6% and Microsoft shares fell 2.6% following reports that Ofcom, the British media regulator, It is pushing for an investigation into Amazon and Microsoft over whether they have monopolistic behavior and are hurting competition in the British cloud computing market.
Investors continue to keep an eye on US labor data this week. To assess the Fed’s interest rate direction Today, private sector employment numbers for September will be released from ADP, and tomorrow the United States will release the number of weekly jobless claims.
As for on Friday The United States will release September non-agricultural employment figures. While analysts predict that Non-agricultural employment figures will increase by 163,000 jobs in September. After adding 187,000 jobs in August And it is expected that the unemployment rate in September will drop to 3.7% from 3.8% in August.
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