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U.S. stocks ended lower on Friday in a choppy trading session as fresh economic data showed lower-than-expected jobs growth in June, while there was a solid jump in wages. Investors were also concerned about the Fed’s next move as they believe that the central bank may hike interest rates at the end of July. All three major indexes ended in negative territory.
How Did The Benchmarks Perform?
The Dow Jones Industrial Average (DJI) slid 0.6% or 187.38 points to finish at 33,734.88 points.
The S&P 500 declined 0.3% or 12.64 points to end at 4,398.95 points. Healthcare, consumer staples, and utility stocks were the biggest losers.
The Health Care Select Sector SPDR (XLV) dropped 1.2%. The Consumer Staples Select Sector SPDR (XLP) declined 1.3%, while the Utilities Select Sector SPDR (XLU) declined 0.7%. Six of the 11 sectors of the benchmark index ended in negative territory.
The tech-heavy Nasdaq slipped 0.1% or 18.33 points to finish at 13,660.72 points.
The fear-gauge CBOE Volatility Index (VIX) was down 3.95% to 14.83. Advancers outnumbered decliners on the NYSE by a 2.49-to-1 ratio. On Nasdaq, a 2.00-to-1 ratio favored advancing issues. A total of 10.3 billion shares were traded on Friday, lower than the last 20-session average of 11.1 billion.
Investors Struggle to Gauge Economy’s Future
Wall Street ended lower in a volatile trading session after investors weighed fresh data that showed jobs additions to the U.S. economy slowed more than expected in June. The Labor Department’s report showed only 209,000 job additions in June, which came in lower than economists’ expectations of a rise of 240,000.
This is also the smallest increase since the end of 2020.
The Fed had been worried that robust job additions to the economy had been posing a challenge in its fight to curb sky-high inflation despite raising interest rates by 500 basis points since March 2022.
The Fed’s aggressive rate hike stance seems to be finally paying off as the labor market appears to show signs of cooling. Also, job openings have lately started declining. However, the data also showed a robust jump in hourly wages, while the unemployment rate fell once again in June to 3.6%.
Although the labor market is cooling, inflation is still elevated and a lot higher than the Fed’s target level of 2%. This has been making investors jittery as the Fed has already indicated two more interest rate hikes of 25 basis points each by the end of this year.
Investors believe that the first of the hikes could be as early as July, which has once again raised concerns about the economy further slowing down.
The 2-year Treasury Yield fell 7.3 basis points on Friday to 4.931, while the 10-year Treasury Yield remained little changed at 4.047%. Consumer staple stocks took a beating on Friday. Shares of The Coca-Cola Company ((KO - Free Report) ) declined 1.3%, while The Hershey Company ((HSY - Free Report) ) and General Mills, Inc. ((GIS - Free Report) ) fell 1.9% and 0.9%, respectively. General Mills has a Zacks Rank #3 (Hold). You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here.
Economic Data
The Labor Department’s data showed that average hourly earnings rose 0.4% in June month over month and 4.4% on a year-over-year basis. The unemployment rate fell to 3.6% in June from 3.7% in May.
Weekly Roundoff
The second half of 2023 started with all three major indexes ending in losses in the first week. The Dow ended 2% lower for the week. The S&P 500 and Nasdaq closed the week 1.2% and 0.9% down.
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Stock Market News for Jul 10, 2023
U.S. stocks ended lower on Friday in a choppy trading session as fresh economic data showed lower-than-expected jobs growth in June, while there was a solid jump in wages. Investors were also concerned about the Fed’s next move as they believe that the central bank may hike interest rates at the end of July. All three major indexes ended in negative territory.
How Did The Benchmarks Perform?
The Dow Jones Industrial Average (DJI) slid 0.6% or 187.38 points to finish at 33,734.88 points.
The S&P 500 declined 0.3% or 12.64 points to end at 4,398.95 points. Healthcare, consumer staples, and utility stocks were the biggest losers.
The Health Care Select Sector SPDR (XLV) dropped 1.2%. The Consumer Staples Select Sector SPDR (XLP) declined 1.3%, while the Utilities Select Sector SPDR (XLU) declined 0.7%. Six of the 11 sectors of the benchmark index ended in negative territory.
The tech-heavy Nasdaq slipped 0.1% or 18.33 points to finish at 13,660.72 points.
The fear-gauge CBOE Volatility Index (VIX) was down 3.95% to 14.83. Advancers outnumbered decliners on the NYSE by a 2.49-to-1 ratio. On Nasdaq, a 2.00-to-1 ratio favored advancing issues. A total of 10.3 billion shares were traded on Friday, lower than the last 20-session average of 11.1 billion.
Investors Struggle to Gauge Economy’s Future
Wall Street ended lower in a volatile trading session after investors weighed fresh data that showed jobs additions to the U.S. economy slowed more than expected in June. The Labor Department’s report showed only 209,000 job additions in June, which came in lower than economists’ expectations of a rise of 240,000.
This is also the smallest increase since the end of 2020.
The Fed had been worried that robust job additions to the economy had been posing a challenge in its fight to curb sky-high inflation despite raising interest rates by 500 basis points since March 2022.
The Fed’s aggressive rate hike stance seems to be finally paying off as the labor market appears to show signs of cooling. Also, job openings have lately started declining.
However, the data also showed a robust jump in hourly wages, while the unemployment rate fell once again in June to 3.6%.
Although the labor market is cooling, inflation is still elevated and a lot higher than the Fed’s target level of 2%. This has been making investors jittery as the Fed has already indicated two more interest rate hikes of 25 basis points each by the end of this year.
Investors believe that the first of the hikes could be as early as July, which has once again raised concerns about the economy further slowing down.
The 2-year Treasury Yield fell 7.3 basis points on Friday to 4.931, while the 10-year Treasury Yield remained little changed at 4.047%. Consumer staple stocks took a beating on Friday. Shares of The Coca-Cola Company ((KO - Free Report) ) declined 1.3%, while The Hershey Company ((HSY - Free Report) ) and General Mills, Inc. ((GIS - Free Report) ) fell 1.9% and 0.9%, respectively. General Mills has a Zacks Rank #3 (Hold). You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here.
Economic Data
The Labor Department’s data showed that average hourly earnings rose 0.4% in June month over month and 4.4% on a year-over-year basis. The unemployment rate fell to 3.6% in June from 3.7% in May.
Weekly Roundoff
The second half of 2023 started with all three major indexes ending in losses in the first week. The Dow ended 2% lower for the week. The S&P 500 and Nasdaq closed the week 1.2% and 0.9% down.