U.S. stock markets tumbled Friday as a much weaker-than-anticipated jobs report for July added to worries that the U.S. economy could be falling into a recession. July job growth in the U.S. slowed more than expected, while the U.S. unemployment rate rose to the highest since October 2021.
Pia Singh and Hakyung Kim for CNBC:
Nonfarm payrolls grew by just 114,000 last month, the Labor Department reported, a slowing from 179,000 jobs added in June and below the 185,000 expected by economists polled by Dow Jones. The unemployment rate increased to 4.3%.
In premarket trading, Amazon led the losses, sliding 9% after missing the Street’s estimates on second-quarter revenue and issuing a disappointing forecast. Intel cratered nearly 24% after announcing weak guidance and layoffs. Apple shares inched lower despite the iPhone maker posting a fiscal third-quarter earnings beat as most tech stocks were hit hard following the weak jobs figures. Nvidia lost 5% in premarket trading following a 6% loss a day before.
Friday’s stock pullback would build on a steep sell-off from the previous session. The Dow and S&P 500 each fell more than 1% on Thursday, while the Nasdaq slid 2.3%. Those declines sent ripples around the world, with the Japanese Nikkei losing 5.8% overnight.
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MacDailyNews Take: In July 2023, the Fed stopped raising rates too soon.
As we wrote in February 2023, “When certain quarters, including the Fed, delude themselves and others that ‘inflation is transitory’ and waste at least a year before doing a mere portion of what is necessary* (interest rate hikes), the price will be paid for being delusional and late.”
‘Tis best to get a handle on inflation, if you know how, while you still can. – MacDailyNews, May 11, 2021
Stop the misguided crusade against domestic energy production and profligate federal spending and inflation will be stopped dead in its tracks. It’s not difficult. – MacDailyNews, May 11, 2022
For new generations, sometimes tough lessons have to be retaught and learned the hard way. As we go through this, remember: It’s always darkest before the dawn. – MacDailyNews, July 14, 2022
Inflation is repudiation. — Calvin Coolidge
When a business or an individual spends more than it makes, it goes bankrupt. When government does it, it sends you the bill… [which] comes in two ways: higher taxes and inflation. Make no mistake about it, inflation is a tax and not by accident. — Ronald Reagan
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