Highlights
Rising bond yields weighed on stocks Thursday but activity was limited by caution before the employment report due Friday. The Dow Jones industrial average lost percent, the S&P 500 eased 0.2 percent and the Nasdaq was flat. Bond yields, the dollar and oil prices rose.
A stronger than expected services report from the nation's purchasing managers pushed up yields despite ongoing safe-haven demand for U.S. Treasuries stemming from the escalating conflict in the Middle East. Rising oil prices added to upward pressure on yields. Fed officials were unusually quiet Thursday.
Strength in Nvidia after upbeat comments from management tended to offset weakness elsewhere among megacaps, which were mostly lower to depress the major averages.
Among sectors, energy advanced as oil prices remained buoyant as the market braces for supply disruptions, in particular if Israel strikes against Iranian oil facilities. Chipmakers lifted information technology and communications services outperformed too. Weak sectors included consumer discretionary as Amazon had a bad day. Financials, real estate, materials and consumer staples also lagged.
Investors are keying on U.S. employment figures for clues on the Federal Reserve's policy stance. Markets have priced out expectations for a 50 basis point rate cut in November and now mostly look for a 25 basis point cut in November and again in December. That would be in line with the Fed's base case as anticipated by policy-makers at the September policy meeting.
A stronger than expected services report from the nation's purchasing managers pushed up yields despite ongoing safe-haven demand for U.S. Treasuries stemming from the escalating conflict in the Middle East. Rising oil prices added to upward pressure on yields. Fed officials were unusually quiet Thursday.
Strength in Nvidia after upbeat comments from management tended to offset weakness elsewhere among megacaps, which were mostly lower to depress the major averages.
Among sectors, energy advanced as oil prices remained buoyant as the market braces for supply disruptions, in particular if Israel strikes against Iranian oil facilities. Chipmakers lifted information technology and communications services outperformed too. Weak sectors included consumer discretionary as Amazon had a bad day. Financials, real estate, materials and consumer staples also lagged.
Investors are keying on U.S. employment figures for clues on the Federal Reserve's policy stance. Markets have priced out expectations for a 50 basis point rate cut in November and now mostly look for a 25 basis point cut in November and again in December. That would be in line with the Fed's base case as anticipated by policy-makers at the September policy meeting.
Definition
Market Reflections track market reaction to the trading day's major events. Economic data, policymaker speeches, and company news are featured in this report as well as key indexes and financial instruments.
Description
Understanding why markets respond as they do is fundamental for an investor. Market Reflections help explain how the day's events, news, and data impact the outlook for the economy and for market prices.
