Wall Street bibbert vor Fed
Robust labor market fuels new interest rate fears
12/02/2022 10:27 p.m
In the US, companies are creating jobs outside of agriculture. Investors fear the Fed might use this as an argument to push for more large rate hikes. Experts expect an increase of 50 basis points in December and February.
The strong US job market data has triggered new interest rate fears among US investors and weighed on Wall Street. According to experts, strong job numbers might shake the interest rate expectations of stock market traders, who had recently assumed that the rate of increases by the US Federal Reserve would slow down. Of the Dow Jones gained 0.1 percent up 34,429.88 points. The tech-heavy one Nasdaq gave up 0.2 percent 11.461,50 Points following and the broad S&P 500 lost 0.1 percent 4071,70 points a.
The jobs data showed the addition of 263,000 US nonfarm payroll jobs in November compared to 261,000 the previous month. Experts had forecast a drop to 200,000. “The strong job creation reinforces the Fed’s argument that much more needs to be done to bring inflation under control,” said James Knightley, chief economist at ING Bank.
The economist expects further rate hikes of 50 basis points in December and February, although the tightening might last longer. According to experts, investors are hoping for a faster slowdown. “We think the market is expecting monetary easing in late 2023,” said Mike Schumacher, strategist at investment bank Wells Fargo. But this was hasty.
Oil prices turned negative once more following the China rally of the past few days. The North Sea variety Brent was 2.4 percent lower at $85.33 a barrel (159 liters) and the light US grade WTI fell 1.8 percent to $79.94 a barrel. Investors are waiting for the meeting of the Opec+ oil association on Sunday and the price cap for Russian oil from Monday. Shortly before, following lengthy hesitation, Poland had agreed to the limit of USD 60 per barrel aimed for by the European Union. According to European Commission President Ursula von der Leyen, the new price cap will be adjustable over time. The aim is to be able to react to market developments.
The new interest rate fears depressed growth stocks such as Apple and Amazon a 0.4 percent and 1.4 percent respectively. The shares of the semiconductor company Marvell fell 1.5 percent following disappointing quarterly results. Also the shares of the carmaker Ford also lost 1.5 percent following lower sales figures for November. That of the automation software developer UiPath increased by 12.5 percent according to figures.
