Dow futures fall 170 points as rates pop on September’s jobs report

Stock futures fell on Friday morning as traders weighed the September jobs report, which showed the jobless rate continued to fall and triggered a rise in interest rates.

Dow Jones Industrial Average futures fell 178 points, or 0.6%. S&P 500 futures fell 0.9%, while Nasdaq 100 futures slid 1.4%.

Friday’s employment figures showed the US economy added 263,000 jobs in Septemberslightly below a Dow Jones estimate of 275,000. However, the jobless rate came in at 3.5%, down from 3.7% the previous month, a sign that the employment situation is continuing to improve. strengthen even as the Federal Reserve attempts to slow the economy with rate hikes to stem inflation.

The drop in the unemployment rate caused rates to soar, in turn weighing on equities. The 2-year Treasury yield jumped 8 basis points to 4.31%. (1 basis point equals 0.01%).

Advanced Micro Devices stock fell in trading overnight after the chipmaker warned its third quarter revenue would be lower than expected. Shares of Levi Strauss slid following a reduction in guidance.

Major averages closed lower in Thursday’s trading, but are on course to cap their best week since June 24 and end around 4% higher. The Dow Jones fell 346.93 points, or 1.15%, to 29,926.94, while the S&P 500 and Nasdaq Composite lost 1.02% and 0.68% respectively on Thursday.

All major S&P sectors ended the session in negative territory, with the exception of energy. The sector rose 1.8% as oil prices rose and is poised to end the week up 14.7%.

“The environment is ripe for a crisis and if the Fed maintains its hawkish communication, I think we are very likely going to have something broken in the financial markets,” said Scott Minerd, Guggenheim’s global chief investment officer on “Closing Bell: Overtime” from CNBC. ” Thursday.

Minerd said the pace of tightening was starting to create fissures in financial markets and could force a pivot from the Fed in the coming weeks.

“All the signs are there,” he said. “I can’t tell you exactly what will cause it, but the environment is ripe and when the Fed pivots, they’re not going to announce it in advance, they’re not going to ring a bell.”

Leave a Comment

Your email address will not be published. Required fields are marked *