Wall Street is in the green after a good but not spectacular report on the labor market was released last month. The government announced that hiring slowed last month, which is just what policymakers need in order to reduce inflation.
As of 10:44 a.m. Eastern time, the S&P gained 51 points, or 1.3%, to 4,018 while the Dow increased 332 points, or 1.1%, to 31,998. The Nasdaq was up 1.4% after dipping slightly earlier.
Investors watched August employment data for an update on the economy’s response to four previous interest-rate rises intended to curb inflation, which is approaching a four-decade high. Fed officials contend that higher interest rates are required to dampen economic activity and decrease upward pressure on consumer prices; a strong reading would have bolstered their argument.
However, businesses created 315,000 jobs, down from around 520,000 last month and in line with experts’ forecasts – a lack of shocks that markets found comforting. The unemployment rate increased from 3.5% to 3.7% as more individuals actively sought jobs and were categorized as jobless.
Lisa Sturtevant, chief economist at Bright MLS, said in a note: “The slowdown in job growth in August may indicate that the Federal Reserve’s policies are beginning to have an effect.”
The benchmark closed August with a loss of 4.2% after soaring the previous month on anticipation that the Fed would halt rate rises due to signals that the U.S. economy was slowing and inflation may be stabilizing.
After the Fed chair’s comments on inflation and rate increases, markets are wary at 04:23
These expectations were crushed by Chairman Jerome Powell’s statement last week that the Fed must maintain high interest rates “for some time” to slow the growth. The main concern for many investors is the amount and timing of the next increase.
The Labor Department revealed last week’s decrease in jobless claims on Thursday, another evidence of a robust labor market. Earlier this week, it was reported that there were two jobs for every jobless individual in July.
The Dow concluded Thursday up 0.5%, while the Nasdaq down 0.3%.
As a result of a new coronavirus epidemic, China on Thursday ordered the majority of Chengdu’s 21 million citizens to remain inside. The region is recuperating from power rationing after a drought drained reservoirs for hydroelectric dams, although analysts have said that the national economic effect should be minimal since the region’s industrial production is a tiny portion of China’s overall industrial output.
During electronic trading on the New York Mercantile Exchange, the price of U.S. crude jumped by $1.47 per barrel, to $88.08 per barrel.
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