Market Snapshot: Dow down 200 points as stocks extend slide triggered by jobs report

by | Feb 6, 2023 | Stock Market

U.S. stocks fell Monday morning, on track for a second day of losses, after an unexpectedly strong jobs report at the end of last week renewed worries about how high the Federal Reserve will have to take interest rates.What’s happening
The Dow Jones Industrial Average
fell 228 points, or 0.7%, to 33,698.

The S&P 500
was down 39 points, or 0.9%, at 4,098.

The Nasdaq Composite
shed 143 points, or 1.2%, to 11,864.

Stocks fell Friday, but the Nasdaq Composite advanced for a fifth straight week, while the S&P 500 saw back-to-back weekly gains. The Dow fell 0.2% last week.

What’s driving markets There continued to be shock over the 517,000 surge in nonfarm payrolls reported by the Labor Department on Friday. “On the one hand, a resilient labor market could buttress households’ willingness and ability to continue consuming and therefore support corporate earnings and equities over the near term,” said Rouyaka Ibrahim, an analyst at BCA Research. But longer-term implications are more dire — if a second wave of inflation is triggered, the Fed would have to act more forcefully, perhaps leading to a deep recession, she said. The yield on the 10-year Treasury
rose 8.4 basis points to 3.617%. The dollar was also extending a bounce from late last week, with the ICE U.S. Dollar Index
up 0.7%. See: How the U.S. dollar could put this stock-market rally to a big test “While there were some promising aspects of the jobs report — cooling wage growth and higher participation — it’s impossible to ignore the fact that the labor market remains red hot,” said Craig Erlam, senior market analyst at Oanda, in a note. “Of course, no one will be surprised if we see huge revisions next month — we’ve seen some substantial ones recently after all — but for now, it’s hard to argue that the easier policy move for the Fed is to keep hiking in 25 basis point increments,” he wrote. Federal Reserve Chair Jerome Powell will have the opportunity to react on Tuesday when he delivers a speech to the Economic Club of …

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