U.S. stocks fall after disappointment over big deals, the Dow losing 100 points


Stocks fell slightly on Friday morning after the August business report exceeded expectations, showing the impact of the re-emergence of the delta-triggered Covid.

The Dow Jones industry average fell 107 points, or 0.3%. The S&P 500 was slightly negative, while the technologically heavy Nasdaq Composite rose about 0.2%.

Payrolls in agriculture increased by 235,000 in August, the labor ministry announced on friday. Economists polled by Down Jones expected 720,000 jobs. The report marks a significant slowdown from the revised figure of 1,053 million in July, and comes as the delta variant of Covid-19 has led to a return to health restrictions in some states and cities.

Forecasts for the report are broad, ranging from about 300,000 to a million. Federal Reserve Chairman Jerome Powell stressed the need for stronger job data before the central bank could launch its massive bond-buying program, and a disappointing report could change expectations about when the Fed will begin downsizing the process.

“The surprisingly low number of jobs this morning significantly obscures the declining outlook as only 235,000 jobs were added in August, likely giving the Fed a break and pushing their plans to announce their bond-cutting plans,” said Chris Zaccarelli, chief investment officer. in the Independent Advisor Alliance, notes. “Many people believe the Fed will announce its reduction plans at this month’s FOMC meeting, and that’s no longer likely.”

The central bank will also check how much Covid has influenced employment and activities during August. The virus variant was a wild card for the economy, and its impact could be a factor rejected by the Fed because it considers it the first step in mitigation policy. Leisure and hospitality, the sector hardest hit by the 2020 pandemic, added zero jobs in August, the report said.

Jason Furman, who was president of the Council of Economic Advisers under President Barack Obama, said of “Squawk Box“that fears of the delta variant of Covid-19 may have caused a short-term blow to the labor market recovery.

“We are ready to add a lot of jobs in the coming months because people are either overcoming the fear of the delta, the delta virus is starting to fall or time is starting to fix all of this,” Furman said.

Semiconductor shares Broadcom was one of the best stocks in early trading, rising 15% after the company’s earnings in the third quarter were above expectations. Shares of home builders, including Lennar and PulteGroup, were under pressure, and American Express was the worst stock in Dow.

At a news conference Friday, President Joe Biden presented the average monthly job gain since taking office and reduced weekly unemployment requirements, and called for additional vaccinations and for Congress to pass infrastructure and budget laws. Biden also said states should consider using federal funds to increase unemployment benefits.

“Even with the progress we have made, we are not where we need to be in our economic recovery,” Biden said.

Included Thursday, The S&P 500 and Nasdaq rose to a record based on better-than-expected unemployment data. Initial applications for unemployment insurance have fallen to their lowest levels since March 2020.

The S&P 500 rose 0.3% to 54. record at closing in 2021. The technologically heavy Nasdaq Composite rose 0.14%, closing at an all-time high. The Dow Jones industry average jumped 131 points or 0.4%.

Stock selection and investment trends from CNBC Pro:

The S&P 500 and Nasdaq started in September on strong legs. The S&P 500 and Nasdaq Composite rose 0.6% and 1.3% this week. The Dow has been roughly in decline since Monday.


Like it? Share with your friends!


What's Your Reaction?

hate hate
confused confused
fail fail
fun fun
geeky geeky
love love
lol lol
omg omg
win win


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