On Thursday (Nov 3) the Dow Jones Industrial Average closed lower for the fourth consecutive day as investors feared that data indicating the strength of the labor market would push the Federal Reserve to adjust, raising interest rates more than expected. .
The Dow Jones Industrial Average closed at 32,001.25, down 146.51 or -0.46%, the S & P500 closed at 3,719.89, down 39.80 or -1.06% and the Nasdaq closed at 10,342.94, down 181.86, or -1.73%.
The Department of Labor said initial jobless claims fell from 1,000 to 217,000 last week. Contrary to analysts’ predictions for a rise of 220,000, the data reflects the continued strength of the US labor market and could support further Fed interest rate hikes.
Markets are still under pressure, as Fed Chairman Jerome Powell signaled after Wednesday’s monetary policy meeting. It is now too early for the Fed to consider suspending interest rate hikes. Powell’s remarks led investors to fear that the Fed’s rate hike cycle was longer than expected. The market has now raised its forecast for the Fed rate cap to 5% or more next year. from previous forecast to 4.50-4.75%
The market was also impacted by a strong dollar and a surge in US Treasury yields. The appreciation of the dollar will affect the profits of listed companies with foreign income. The surge in 10-year US Treasury yields, the bond used to price global bonds, including US mortgage interest rates, has led to higher yields. This will cause companies to face higher debt repayment costs. This allows these companies to reduce their investments and reduce dividend payments to investors.
Interest Rate Sensitive Communications and Technology Securities. falling continuously Alphabet fell by 4.07%, Microsoft by 2.66%, Meta Platforms by 1.8%, Netflix by 1.44% and Snap by 3.78%.
Shares of Qualcomm Inc., a leading global mobile phone chip maker, and streaming media entertainment company Roku fell 7.66% and 4.57%, respectively, after the two companies released their results. . Operating results lower than expected in the third quarter
However, industrial stocks rebounded. This reduces the negative range of the Dow Jones index during the day. Boeing is up by 6.39%, Caterpillar by 2.22%, General Electric (GE) by 1.12% and Honeywell by 1.96%.
For the US, the economic data reported last night. US Department of Commerce said US factory orders rose 0.3% in September, in line with analysts’ expectations. after a 0.2% increase in August
The Institute for Supply Management (ISM) said its services index fell to 54.4 in October, its lowest level since May 2020, from 56.7 in September. 17 sectors, including real estate, transportation, construction and mining.
Investors are looking forward to the release of non-farm payrolls for the month of October in the United States today. While analysts had predicted the number of jobs will increase by just 205,000 in October. after adding 263,000 jobs in September
