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Investing.com – The main indices on Wall Street interacted with the US unemployment data released a short while ago, as indices witness collective declines during these moments of Thursday’s trading.
The economic data released this week indicates that the US economy is on the brink of recession, as the labor market data and preliminary employment data came in negative, in addition to the unemployment data released a short while ago, which reported an increase in unemployment benefits.
Although the data released this week supports the dollar’s decline and gold’s rise, gold is still in a downside range, coinciding with the dollar’s slight rise. As the negativity of the labor market, employment and unemployment data is supposed to support the Fed’s calmness in its monetary policy for the coming period. However, it is believed that gold did not interact with the increase in subsidies more than expected, but rather interacted with their decrease from last week, after the previous reading was revised to rise from 198 thousand to 246 thousand.
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What is driving the market?
Looking beyond the banking crisis, two major market catalysts will remain at the forefront in April: inflation and interest rates.
The consumer price index rose 6% year-on-year in February, down from peak inflation levels of 9.1% in June 2022, but still well above the Fed’s long-term target of 2%.
“Recession risks remain high as the Fed nears the end of its rate hike campaign,” says Jeffrey Roach, chief economist at LPL Financial.
The data issued during the past few days indicate that the Fed may review its monetary policies in the coming period, given that it indicates a recession in the US economy. This view may be supported if the employment data due to be released tomorrow is also negative.
Recently released data
It recorded 228,000 applications, higher than the forecasts of experts who predicted 200,000. Especially since it recorded 198 thousand the week before last, but this reading has been revised to record now 246 thousand.
Thus, it rose in 4 weeks to 237.75 thousand, after recording the week before last 242 thousand.
The Challenger employment report was released moments ago, revealing a strong increase in US job cuts (layoffs) in the first quarter of 2023. Job cuts rose in March to 89.7 thousand layoffs, compared to 77.77 in the previous reading, while experts expected the number to decrease to 65.00. alpha.
Thus, the first quarter of 2023 witnessed the highest employment reduction rates since the first quarter of 2020.
Indicators at yesterday’s close
The decline dominated the US stock indices at the end of Wednesday’s session, but the “Dow Jones” rose alone, with signs of a weak economy.
Investors preferred to stay away from growth stocks, after economic data showed a slowdown in the labor market and a decline in industrial and service activities in the United States.
At the end of the session, the “Dow Jones” industrial index rose by 0.2%, or the equivalent of 80 points, at 33.482 thousand points.
While the “S&P 500” declined by 0.2%, or 10 points, to 4090 points.
“Nasdaq” fell by 1.07%, equivalent to 129 points, to record 11.996 thousand points.
Indicators at the time of writing
The industrial index fell 0.4% to 33,345 points.
It fell by 0.3%, at 4078 points.
While the compound fell 0.3% to 11961 points.
Markets at the time of writing
It declines 0.5% to $2025.
It fell by 0.55% at 2010 dollars an ounce.
While it increased by 0.1%, to record 101.62 points.
Crude futures settled at 85 per barrel.
US West Texas Intermediate crude also settled at $80.6 a barrel.
