The Dow Jones Industrial Average closed more than 400 points on Thursday (Sept. 29) as investors feared the Federal Reserve’s raising interest rates to curb inflation would push the U.S. economy into a frenzy. In addition, volatility in the global foreign exchange and bond markets is another factor that puts pressure on the stock market.
- The Dow Jones Industrial Average closed at 29,225.61, down 458.13 or -1.54%,
- The S&P 500 index closed at 3,640.47, down 78.57, or -2.11%, and
- The Nasdaq index closed at 10,737.51, down 314.13, or -2.84%.
The US bond market faces another sell-off. After several Fed officials, including Cleveland Fed President Loretta Mester, Still encouraging the Fed to continue raising interest rates to bring inflation back to its target.
The decline in unemployment claims in the US to a five-month low is evidence that the US labor market is still recovering. Although the Fed has raised interest rates aggressively in the past.
The number of first-time claims for unemployment benefits fell 16,000 to 193,000 last week, the Labor Department said. which is the lowest level since April and the analysts are expected to increase to 213,000.
Phil Blancato, an analyst at Thelmann Asset Management, said: This latest labor data is good news in bad news. The decline in unemployment underscores that the Fed still has room to continue its tightening policy. What the market is worried about right now is The Fed’s monetary policy will cause a severe recession. and will affect the operating results of listed companies These concerns are the cause of the sell-off in the stock market.
All 11 stocks in the S&P500 index fell, led by utility stocks. and luxury goods PG&E shares were down 2.56 percent, Excelon Corporation was down 4.86 percent, Ralph Lauren was down 1.87 percent, and Nike was 3.41 percent.
Airline and Cruise Shares Fall After reports that the influence of Hurricane Ian (Ian) resulted in the cancellation of flights and cruise ships. United Airlines were down 2.98 percent, Delta Air Lines were down 3.56%, American Airlines was 3.92 percent, Royal Caribbean Cruises was 7.93%, and Carnival Corp was 6.82%.
Apple shares fell 4.91 percent after Bank of America analysts downgraded Apple’s investment attractiveness to “neutral” from “Buy” following reports that Apple had canceled plans to increase iPhone 14 production over concerns about the company. The market demand is lower than the previous forecast.
Meta Platform fell 3.67 percent after media reports reported that Facebook’s executives planned to suspend jobs and warned employees to be prepared for an upcoming layoff.
For the US economic data released last night. The Commerce Department released its final estimate for its second-quarter gross domestic product (GDP), showing US GDP contracted 0.6%, unchanged from the second estimate, while the first estimate showed the economy contracted. 0.9%
In the first quarter, US GDP contracted 1.6%. Two consecutive quarters of GDP contraction indicates that the US economy has entered a technical recession.
By InfoQuest News Agency (30 Sept. 65)
Tags: Dow, stock market, new york stock market