Now Reading: US stocks dip after weak jobs data eases rate hike fears
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US stocks dip after weak jobs data eases rate hike fears
US stocks are on track for their best week since April after the Labour Department reported July nonfarm payrolls fell by 23,000 jobs, far below the 80,000 gain economists had forecast. The…
The Story in Brief
US stocks are on track for their best week since April after the Labour Department reported July nonfarm payrolls fell by 23,000 jobs, far below the 80,000 gain economists had forecast. The unemployment rate ticked down to 4.1% from 4.2% as workers left the labour force. Market expectations of a Federal Reserve rate hike at its next meeting dropped to 44.1% from 55% a day earlier, according to CME FedWatch. A strong earnings season has also boosted sentiment, with 85.1% of S&P 500 companies beating analyst estimates.
The Dow Jones Industrial Average rose 0.13%, the S&P 500 gained 0.44%, and the Nasdaq Composite climbed 0.97%. Among individual stocks, Atlassian surged 37.4% and Airbnb rose 15.7% after beating revenue estimates, while Trade Desk fell 21.3% on weak guidance. Signs of progress on an Iran peace deal helped cool oil prices and eased inflation worries.
The Indian Opinion
The market's celebration of weak jobs data is a paradox dressed up as a rally. Lower payrolls reduce the immediate fear of a rate hike, but they also signal a slowing economy that might need stimulus, not higher rates. The narrative that bad news is good news because it keeps the Fed dovish ignores the real risk of stagflation. The true test will come when the next inflation print arrives: will falling employment and rising prices force the Fed to choose between two evils?
Source: livemint.com
This story was synthesised by AI from the source linked above.
