{"id":131044,"date":"2023-01-26T18:36:40","date_gmt":"2023-01-26T18:36:40","guid":{"rendered":"https:\/\/fin2me.com\/?p=131044"},"modified":"2023-01-26T18:36:40","modified_gmt":"2023-01-26T18:36:40","slug":"economic-worries-lead-to-further-downside-on-wall-street","status":"publish","type":"post","link":"https:\/\/fin2me.com\/business\/economic-worries-lead-to-further-downside-on-wall-street\/","title":{"rendered":"Economic Worries Lead To Further Downside On Wall Street"},"content":{"rendered":"

After ending the previous session sharply lower, stocks saw further downside during trading on Thursday. The major averages fluctuated after coming under pressure in early trading but remained stuck in the red.<\/p>\n

The major averages all finished the day firmly in negative territory. The Dow slid 252.40 points or 0.8 percent to 33,044.56, the Nasdaq slumped 104.74 points or 1.0 percent to 10,852.27 and the S&P 500 fell 30.01 points or 0.8 percent to 3,898.85.<\/p>\n

Concerns about the economic outlook continued to weigh on the markets<\/span> following Wednesday’s disappointing retail sales and industrial production data.<\/p>\n

Traders also remain concerned about the outlook for interest rates amid worries the Federal Reserve will continue aggressively raising rates despite signs of a slowdown in inflation.<\/p>\n

While the Fed is widely expected to further slow the pace of rate hikes to 25 basis points at its next meeting, traders are expressing some uncertainty about the possibility of further rate hikes.<\/p>\n

Adding to the concerns about interest rates, a report released by the Labor Department unexpectedly showed a decrease in first-time claims for U.S. unemployment benefits in the week ended January 14th.<\/p>\n

The Labor Department said initial jobless claims fell to 190,000, a decrease of 15,000 from the previous week’s unrevised level of 205,000. The dip surprised economists, who had expected jobless claims to rise to 214,000.<\/p>\n

“While initial jobless claims continue to be noisy due to seasonal adjustment factors, the unexpected drop in the latest week is a frustrating reminder for the Fed that the labor market remains tight as employers hold onto workers,” said Matthew Martin, US Economist at Oxford Economics.<\/p>\n

He added, “Our forecast assumes one more 25bps rate hike at the conclusion of the upcoming FOMC meeting, but we see risks as skewed toward additional rate hikes.”<\/p>\n

Meanwhile, the Commerce Department released a report showing new residential construction in U.S. fell for the fourth straight month in December, although the decrease was much smaller than expected.<\/p>\n

The report said housing starts slumped by 1.4 percent to an annual rate of 1.382 million in December after tumbling by 1.8 percent to a revised rate of 1.401 million in November.<\/p>\n

Economists had expected housing starts to plunge by 4.8 percent to an annual rate of 1.359 million from the 1.427 million originally reported for the previous month.<\/p>\n

The Commerce Department said building permits also dove by 1.6 percent to an annual rate of 1.330 million in December after plummeting by 10.6 percent to a revised rate of 1.351 million in December.<\/p>\n

Building permits, an indicator of future housing demand, were expected to jump by 2.1 percent to an annual rate of 1.370 million from the 1.342 million originally reported for the previous month.<\/p>\n

Sector News<\/p>\n

Semiconductor stocks saw substantial weakness on the day, resulting in a 2.8 percent nosedive by the Philadelphia Semiconductor Index.<\/p>\n

Considerable weakness was also visible among housing stocks, as reflected by the 2.3 percent slump by the Philadelphia Housing Sector Index.<\/p>\n

Retail stocks also showed a significant move to the downside, dragging the Dow Jones U.S. Retail Index down by 2.1 percent.<\/p>\n

Computer hardware, networking and brokerage stocks also saw notable weakness, while gold and oil stocks bucked the downtrend amid increases in the prices of their associated commodities.<\/p>\n

Other Markets<\/p>\n

In overseas trading, stock markets across the Asia-Pacific region turned in a mixed performance during trading on Thursday. Japan’s Nikkei 225 Index tumbled by 1.4 percent, while China’s Shanghai Composite Index rose by 0.5 percent.<\/p>\n

Meanwhile, the major European markets all moved to the downside on the day. While the U.K.’s FTSE 100 Index slumped by 1.1 percent, the German DAX Index and the French CAC 40 Index plunged by 1.7 percent and 1.9 percent, respectively.<\/p>\n

In the bond market, treasuries gave back ground after moving sharply higher in the previous session. Subsequently, the yield on the benchmark ten-year note, which moves opposite of its price, rose by 2.2 basis points to 3.397 percent.<\/p>\n

Looking Ahead<\/p>\n

Following the slew of U.S. economic data released over the past two days, the economic calendar is relatively light on Friday, although a report on existing home sales may still attract some attention.<\/p>\n

On the earnings front, streaming giant Netflix (NFLX) is among the companies releasing their quarterly results after the close of today’s trading. <\/p>\n

Source: Read Full Article<\/a><\/p>\n","protected":false},"excerpt":{"rendered":"

After ending the previous session sharply lower, stocks saw further downside during trading on Thursday. 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