Stock market today: the Dow Jones is essentially stable as the wage bill disappoints
The stock market plunged on Friday after the September jobs report missed estimates, although the data was better than the overall result would suggest.
Dow Jones Industrial Average
fell by 9 points, essentially unchanged, while the
fell 0.2% and the
decreased by 0.5%. All three indices fluctuated between slight gains and losses during the day. The 10-year US Treasury yield first declined and then rose to 1.6%.
With higher bond yields and the economically sensitive Dow Jones outperforming the other two major indices, markets appeared somewhat bullish on the direction of the economy.
The United States created 194,000 jobs in September, missing the forecast of 500,000 and below the revised August reading of 366,000. The unemployment rate, however, fell to 4.8%.
But there have been revisions to summer job gains; there were 169,000 more jobs added over the summer than initial reports showed, making the current picture of job growth much stronger.
“The market is looking through the numbers,” said Mark Luschini, chief investment strategist at Janney Montgomery. “A [reason] was the revision of the two-month count, bringing the total to 300,000. “
In addition, 74,000 jobs have been created in the leisure and hospitality industry, while government jobs have declined, meaning some expect total job gains to be strong in the future. ‘to come up.
“Most of the shortfall was the government, which was sort of also negative,” said Rhys Williams, chief investment officer at Spouting Rock Asset Management.
Given these assumptions, the Federal Reserve should soon begin to reduce its bond purchases.
“A lower-than-expected number of jobs is unlikely to change the thinking of the Fed,” wrote Richard Saperstein, chief investment officer of Treasury Partners. “The Federal Reserve remains on track to start cutting its stimulus measures in November or December.”
Others agree. “The disappointing 194,000 gain in nonfarm payrolls in September probably still counts as ‘decent’ enough for the Fed to start cutting back on asset purchases next month,” writes Andrew Hunter, an economist at Capital Economics.
Fewer Fed bond purchases mean less money will go into the bond market, which could lower bond prices and raise bond yields. Higher bond yields make future earnings less valuable, putting inordinate pressure on the tech-rich Nasdaq.
Abroad, in Tokyo
rose 1.3% as investors reacted positively to orders from Prime Minister Fumio Kishida for his cabinet to compile economic stimulus packages for a supplementary budget to be submitted after an election at the end of the month.
The pan-European Stoxx 600 fell 0.3%.
Here are nine stocks in motion on Friday:
Hong Kong-listed stocks (9988.HK) rose 5.6%, while
U.S.-listed stocks (BABA) rose 3.5% on Friday.
The share (QDEL) rose 1.3% after the company said third-quarter sales would be between $ 505 million and $ 510 million, ahead of analysts’ estimates of $ 251 million , according to FactSet. The company said it shipped more than double the number of SARS tests year over year.
Connect the power
The stock (PLUG) gained 4.2% after being leveled at equal weight from underweight at Barclays.
The stock (UNP) rose 2.2% after being overweight neutral at JPMorgan.
JB Hunt Transport Services
(JBHT) stock fell 1.9% after being downgraded to Underweight Neutral at JPMorgan.
Cos. (LOW) and
(HD) fell 0.8% and 0.9%, respectively, after being demoted to Hold from Buy at Loop Capital.
Rising crude prices have given big oil companies a boost, with
(BP) up 2.5% and
Royal Dutch Shell
(RDS.A) up 2.2% in London.
Write to Jacob Sonenshine at [email protected]