Market Snapshot: Dow ends nearly 200 points lower as investors weigh ISM manufacturing and inflation data, await jobs report

by | Dec 1, 2022 | Stock Market

U.S. stocks finished a choppy session mostly lower on Thursday after the ISM manufacturing index showed American factory activities contracted to a 30-month low in November. Stocks had opened mostly higher Thursday after the Federal Reserve’s preferred inflation measure showed price pressures cooling in October, while reports suggested China is taking steps to relax its COVID restrictions to allow its economy to recover.

Investors now await November jobs data on Friday that could determine the pace of the central bank’s interest-rate hikes.How stock indexes traded
The Dow Jones Industrial Average
fell 194.76 points, or 0.6%, to finish at 34,395.01.

The S&P 500
shed 3.54 points, or less than 0.1%, ending at 4,076.57.

The Nasdaq Composite
gained 14.45 points, or 0.1%, to end at 11,482.45.

On Wednesday, the Dow rose 737 points, or 2.2%, to officially exit a bear market, while the S&P 500 jumped 3.1%, and the Nasdaq Composite advanced 4.4%. The Dow rose 20.4% during October and November, the biggest two-month percentage gain since July 1938, according to Dow Jones Market Data.What drove markets The Institute for Supply Management’s manufacturing index, a key barometer of activity at American factories, fell to 49% in November, down from 50.2% in October. The ISM report is viewed as a window into the health of the economy, and numbers below 50% signal the economy is contracting. Stocks turned down on profit-taking after Wednesday’s big jump, said Michael Hewson, chief market analyst at CMC Markets, in a note, while the ISM data underlined expectations the Fed has room to slow down the pace of rate increases. “This peak inflation, softer growth narrative was reinforced by the ISM manufacturing survey which fell into contraction territory for the first time since May 2020, while prices paid fell to 43, and employment also contracted at 48.4,” he wrote. Earlier, a gauge of U.S. inflation, the personal-consumption expenditures index, rose a modest 0.3% in October, adding another piece of evidence that points to slowly easing price pressures. The yearly rate of inflation slowed to 6% in October from 6.2% in the prior month and a 40-year high of 7% last summer. The core gauge that strips out volatile food and energy cos …

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