-
US stocks fell after a weak July jobs report raised concerns of a slowing economy.
-
The US added 114,000 jobs in July, below estimates of 175,000, and the unemployment rate unexpectedly rose to 4.3%.
-
Intel and Amazon’s weak earnings reports also contributed to Friday’s stock market decline.
US stocks dropped on Friday after a weak July jobs report raised concerns of a slowing economy and cast a shadow over the prospects of a soft landing.
The US economy added 114,000 jobs in July, well below economist estimates of 175,000. The unemployment rate also unexpectedly rose to 4.3% from 4.1%, its highest level since October 2021.
The 10-Year US Treasury yield plunged nearly 20 basis points to a 2024 low of 3.80% immediately after the jobs report was released.
“The sharp slowdown in payrolls in July and sharper rise in the unemployment rate makes a September interest rate cut inevitable and will increase speculation that the Fed will kick off its loosening cycle with a 50 bp cut or even an intra-meeting move,” economist Stephen Brown at Capital Economics said.
Odds of a 50-basis point interest rate cut at the Federal Reserve’s September FOMC meeting soared to 62% on Friday, a near triple from its 22% reading on Thursday, according to the CME Fed Watch Tool.
Also pushing stocks lower were weak earnings reports and guidance from Intel and Amazon. Intel stock plunged 25% after it cut its dividend and laid off 15% of its workforce, and Amazon stock dropped about 10% after it offer a tepid third-quarter sales outlook.
Here’s where US indexes stood shortly after the 9:30 a.m. opening bell on Friday:
Here’s what else is going on today:
In commodities, bonds, and crypto:
-
West Texas Intermediate crude oil fell 2.03% to $74.76 a barrel. Brent crude, the international benchmark, declined 1.72% to $78.15 a barrel.
-
Gold was higher by 1.04% to $2,506.60 per ounce.
-
The 10-year Treasury yield dropped 11 basis points to 3.87%.
-
Bitcoin was lower by 0.81% to $64,771.
Read the original article on Business Insider
