April 2, 2023

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Stocks tumbled again in another volatile session

Stocks tumbled again in another volatile session

US stocks rebounded in another volatile session on Thursday after renewed concerns about the economy and a weak outlook from market leader Microsoft (MSFT) affected the sentiment in the previous trading.

The S&P 500 jumped 0.4%, up from a lower opening, while the Dow Jones Industrial Average hovered just above the breakeven point. The tech-heavy Nasdaq extended its gains to 1.1% as the three indices attempt to rebound from two consecutive days of losses.

Microsoft shares fell 2% at the open after the tech giant cut its earnings and revenue forecasts, citing headwinds from moves in foreign exchange rates, to join other companies that recently reported that they are grappling with challenging macroeconomic conditions.

Investors also weighed a set of employment data. The latest weekly jobless claims report released by the Labor Department showed that unemployment insurance claims fell unexpectedly to 200,000 in a sign that labor market conditions remain a bright spot in the economy amid growing fears of a slowdown. On the other hand, the rate of job creation in the US private sector fell sharply last month to the slowest pace of growth in the recovery in the COVID era, according to the ADP private jobs report.

Oil prices pulled back from gains earlier this week after reports from Saudi Arabia and other members of OPEC May boost crude oil production to offset sharp decline In Russia production under New sanctions by the European Union. West Texas Intermediate (WTI) and Brent crude futures fell more than 3% Thursday morning.

Wall Street weighed several quarterly reports in early trade. Chewy pet retailerCHWY) Shares traded more than 12% at the open after the company reported a surprising profit after the closing bell on Wednesday. Hewlett-Packard Company (HP) to a growing list of company names that have lowered expectations due to macroeconomic headwinds from supply chain disruptions, unfavorable currency movements and its exit from Russia. Shares are down about 8% in early trading.

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More in-store earnings for traders through Friday from companies including Lululemon (lulu), RH (R) and octa (OKTA). As earnings season approaches, investors will take their cues from economic data, with an eye on the labor market.

On Wednesday, the April job vacancy report, also known as JOLTS, reflected a drop in job vacancies, a data point the Federal Reserve is likely to view favorably as it cools the labor market. Manufacturing data released by the Institute of Supply Management on Wednesday also indicated the resilience of the economy and indicated that fears of deflation may be exaggerated.

Data synchronized with Market moving comments from JPMorgan (JPM) CEO Jamie Dimon who pointed to a bleaker view of the economic picture of the United States. At a conference on Wednesday, the leader of the largest US bank said the economy faces a “hurricane” as the Federal Reserve presses ahead with its monetary tightening plans.

“Are we going to slow down from a growth perspective? Yes, sure,” Cliff Hodge, chief investment officer of Cornstone Wealth Group, told Yahoo Finance Live on Wednesday, commenting on Damon’s remarks. “Are we going to fall into a recession? Eventually, but I think it will take longer.”

In the last session, the Federal Reserve indicated in its periodic “Beige Book” that US economic activity may have calmed in some parts of the country, affected by inflation, supply chain and labor shortages.

“Labour shortages continue to keep labor markets tight and businesses understaffed,” said Jeffrey Roach, LBL’s chief financial economist, in a commentary. “In some areas, companies are freezing hiring, which corresponds to the drop in job openings in April reported by the Bureau of Labor Statistics.”

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9:30 a.m. ET: Stocks extended losses as Microsoft’s weak guidance weighs on technology

Here are the major moves in the markets as of 9:30 AM ET:

9:18AM ET: Another 200,000 Americans filed new claims last week

Unemployment insurance claims fell unexpectedly in the latest weekly data indicating that labor market conditions remain a bright spot in the economy amid growing fears of a slowdown.

Ministry of Labor Latest weekly report on unemployment claims It showed that 200,000 claims were filed in the week ending May 28, less than the expectation of 210,000 economists polled by Bloomberg.

Last week, the Labor Department’s weekly data raised investor concerns that the labor market may be quiet as the Federal Reserve tightens financial conditions.

“Employment claims were higher two weeks ago which raised some concerns that the economy has suddenly hit a soft patch, but today’s data suggests that a storm is not brewing in labor markets,” FWDBONDS chief economist Christopher Robke said in a note. “Quite the opposite, as the decrease in the total number of people receiving unemployment compensation indicates that the unemployment rate may fall in tomorrow’s monthly report to a new record low.

9:06AM ET: US private payroll growth sees worst month since April 2020

US private sector job creation fell sharply last month to the slowest pace of growth in the COVID-era recovery, indicating slowing demand for labor amid the backdrop of higher interest rates and tightening financial conditions.

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The ADP said in its report that private sector payrolls grew by 128 thousand in May Monthly report closely on Thursday. This came after an increase of 202 thousand jobs added in April, down from 247 thousand jobs reported in the preliminary reading. Economists were unanimously looking for a private payroll increase of 300,000, according to Bloomberg data.

The ADP’s monthly private jobs report comes ahead of the Labor Department’s official jobs report on Friday. While the ADP report usually does not act as a perfect indicator of what to expect in government-released data due to differences in survey methodology, print has often served as a measure of job growth that has occurred over a given period.

“With a tight labor market and high inflation, monthly job gains are approaching pre-pandemic levels,” said Nella Richardson, ADP’s chief economist. A concern because they are struggling to keep up with the larger companies that have been thriving lately.”

7:12 a.m. ET: Stock futures jump, oil slides ahead of market open

Here’s where the major indicators are in pre-market trading on Thursday:

  • S&P 500 futures contracts (ES = F.): +24.00 (+0.59%) to 4123.00

  • Dow futures contractsYM = F.): +154.00 (+0.47%) to 32952.00

  • Nasdaq futures contractsNQ = F.): +95.00 (+0.76%) to 12646.00

  • raw (CL = F.): -3.23 (-2.80%) up to $112.03

  • He went (GC = F.): + 9.90 USD (+ 0.54%) to 1858.60 USD per ounce

  • Treasury for 10 years (^ degeneration): +8.00 basis points to produce 2.931%

A trader works on the trading floor of the New York Stock Exchange (NYSE) in Manhattan, New York City, US, May 20, 2022. REUTERS/Andrew Kelly

Alexandra Semenova is a reporter for Yahoo Finance. Follow her on Twitter Tweet embed

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