Jobs Slowdown Hits Stocks

 

Jobs Slowdown Hits Stocks

 

 

US employers added fewer-than-expected nonfarm jobs in July as the country's unemployment rate ticked up for the fourth consecutive month to 4.3%, the highest since October 2021, according to government data released yesterday. The latest report spurred a sell-off in the US stock markets, with all three major indexes closing down and the Nasdaq composite entering correction territory (S&P 500 -1.8%, Dow -1.5%, and Nasdaq -2.4%). US employers added 114,000 jobs last month, below economist estimates of 185,000 and down from the downwardly revised 179,000 jobs in June. Average hourly earnings in July rose 0.2% month-over-month and 3.6% year-over-year, both below economist estimates. The data comes after the Federal Reserve on Wednesday signaled an interest rate cut was likely in September. Analysts say the report suggests the Fed could slash rates by half a percent. See a breakdown of data here. Meanwhile, the average rate on the 30-year fixed mortgage dropped to 6.4% Friday, the lowest since April 2023. The average rate on a 15-year fixed mortgage dropped to 5.9%, the lowest since May 2023.