The Dow Jones Industrial Average rebounded following an earlier loss in the wake of a July jobs report that was much better than expected, as investors assessed what a strong labor market would mean for the Federal Reserve's rate tightening campaign.
The Dow Jones Industrial Average shed just 3 points after being down more than 200 points. Bank stocks led the intraday comeback as rates surged from the strong jobs report. The S&P 500 was flat after earlier losing about 1%. The Nasdaq Composite was down about 0.1%.
The labor market added 528,000 jobs in July, easily beating a Dow Jones estimate of a 258,000 increase. The unemployment rate ticked down to 3.5%, below the 3.6% estimate. Wage growth also ticked up more than estimated, up 0.5% for the month and 5.2% higher than a year ago, signaling that high inflation is likely still a problem.
Stocks opened lower following the report, even as it seemed to indicate the economy was not currently in a recession.
"Anybody that jumped on the 'Fed is going to pivot next year and start cutting rates' is going to have to get off at the next station, because that's not in the cards," said Art Hogan, chief market strategist at B. Riley Financial. "It is clearly a situation where the economy is not screeching or heading into a recession here and now."
Job growth was expected to slow as the Fed continues to hike interest rates to tame surging inflation, but this report shows a labor market still running hot. The report is a crucial one as it's one of two the central bank will see before it decides how much to raise rates at its September meeting.
Major averages posted their best month since 2020 in July on the hope the Fed would slow the pace of its hikes. The S&P 500 added 9.1% last month.
Dow slips after strong July jobs report points to more aggressive Fed - CNBC
Read More
No comments:
Post a Comment