The Dow Jones Industrial Average fell 500 points after the U.S. reported higher-than-expected non-farm payrolls. This will be a factor supporting the US Federal Reserve (Fed) to accelerate interest rates.
At 9:09 p.m. GMT, the Dow Jones Industrial Average was 29,426.22, minus 500.72, or 1.67%, while the S&P 500 was down 2.05% and the Nasdaq was down 2.61%.
Stocks fell in all segments. including financial stocks Which is seen to benefit from a rebound in interest rates.
The market was also pressured by the strong dollar. and the rebound in US Treasury yields after the release of the employment report.
The strength of the dollar has raised investors’ fears that it will affect the bottom line of listed companies with foreign earnings. The rise in 10-year US Treasury bonds, which are US government bonds used as a reference for global bond prices. This includes the US mortgage interest rate. will make consumers have less money for spending while the cost of paying off mortgage loans increases And companies will face higher costs of debt settlement. causing these companies to reduce their investment and reduce dividend payments to investors
The US Department of Labor said Non-farm payrolls increased by 263,000 in September. It was higher than analysts’ estimates of 250,000, but below 315,000 in August.
The unemployment rate fell to 3.5% from 3.7 percent in August.
Investors view that Higher than expected employment figures And the unemployment rate fell to 3.5% in September, indicating strength in the US labor market. And it will be a factor supporting the Fed to accelerate further interest rate hikes.
Investors added that The Fed will raise interest rates by 0.75% at its monetary policy meeting in November. After revealing the number of non-farm payrolls today
The latest CME Group’s FedWatch Tool indicates that investors are weighing 82.3% that the Fed will raise interest rates 0.75% to 3.75-4.00% at its Nov. 1-2 meeting, after previously weighing 77.1. %
If the Fed raises interest rates by 0.75% in November, it will raise interest rates by 0.75% for the fourth time after raising 0.75% in June, July and September. .
Meanwhile, investors are keeping an eye on the minutes of the Fed’s September meeting on Oct. 12 and the Consumer Price Index (CPI) on Oct. 13 for any indication of the Fed’s interest rate direction.