There was a bad mood on Wall Street when the trading bell rang on Friday after the presentation of the “most important numbers of the month” – indicating that the Federal Reserve must continue its aggressive interest rate policy.
Here’s how the benchmark indices opened at 15.30 Norwegian time:
- The Dow Jones fell 0.92%.
- The Nasdaq fell 1.79%.
- The S&P 500 fell 1.23%.
In September, 263,000 new non-farm jobs were created in the United States. Recent data from the United States Department of Labor prove this.
Job creation is higher than expected. Bloomberg’s consensus estimate predicted 255,000 new jobs.
At the same time, the unemployment rate drops to 3.5 percent. Previously, the unemployment rate was expected to remain unchanged at 3.7 percent.
The new statistics, which indicate that the central bank’s strong interest rate measures have not been able to cool the economy as expected, triggered an immediate drop in the S&P 500 in pre-trade. The fall was reinforced when the stock market opened an hour later.
The eyes lift up triple – again
– These figures provide the Fed with even more arguments for raising interest rates. They indicate that the labor market in the United States remains rigid and that it will take some time for it to normalize, Akershus Eiendom’s chief economist Kari Due-Andresen told DN.
– With unemployment so low, it also contributes to continued upward pressure on wages, continues the chief economist, referring to the fact that central bank governor Jerome Powell is trying right now to avoid a spiral of wages and prices.
To combat skyrocketing inflation, the Federal Reserve stepped in with several “triple hikes” in interest rates on 21 September.
– Looks like these are strong enough to bolster market expectation of a further 75 basis point hike from the Fed at the next interest rate meeting, says Due-Andresen.
Kari Due-Andresen, chief economist and chief of analysis at Akershus Eiendom, says the jobs data pave the way for another triple Federal Reserve hike. (Photo: Fredrik Solstad)
Scattered macro characters
US equity markets started October with a solid rally, after what many have interpreted as an indication that activity in the US economy is starting to cool, so that the US central bank may be able to calm its down. strong interest rate regime.
Over the course of the week, however, several figures took slightly different directions. The latest manufacturing PMI points to a slowdown, while ADP employment data for private industries surprised slightly on the upside.(Terms)Copyright Dagens Næringsliv AS and / or our suppliers. We would like you to share our cases via links, which lead directly to our pages. Copying or other forms of use of all or part of the content may only take place with written permission or as permitted by law. For additional terms look at her.
