Stocks move lower as investors await Fed
Technology shares biggest drag on broader market
NEW YORK, Sept 8, (AP): Stocks fell Wednesday as investors remain on the sidelines until they get more guidance from the Federal Reserve as well as the direction of the coronavirus pandemic.
The S&P 500 index was down 0.3% as of 11:22 a.m. Eastern. The Dow Jones Industrial Average fell, 62 points or 0.2%, to 35,037 and the Nasdaq composite was down 0.8%. Most of the market was moving lower, with exception of lower-risk sectors like makers of consumer staples and utilities.
Technology stocks were the biggest drag on the broader market. Apple fell 1.3% and chipmaker Nvidia fell 2.5%.
Shares of cryptocurrency trading platform Coinbase fell 4.1% after the company disclosed it was being investigated by the Securities and Exchange Commission over its plans to offer its cryptocurrency holders a chance to earn interest on their assets if they lent them out.
The market continues to remain in a narrow range of gains and losses for the past couple of weeks, as investors look for any sort of understanding of where the U.S. economy is headed with the widespread delta variant of the coronavirus.
U.S. employers posted record job openings for the second consecutive month in July, according to the Labor Department. The disconnect between the growing number of job openings and the weak recovery for employment levels is another signal that the overall jobs recovery could be crimping the broader economic recovery.
Investors will get some additional new information from the Federal Reserve later Wednesday when the central bank releases its “Beige Book” survey of regional economic conditions. The collection of anecdotal economic data and observances is used by policymakers to help them decide how to move interest rates and, more importantly, decide whether to end the bank’s bondbuying program that’s existed since the pandemic started.
The yield on the 10-year Treasury note fell to 1.36% after rising sharply on Tuesday to 1.37%.
Shares slipped in Asia and Europe on Wednesday after a lackluster session on Wall Street, where weak jobs data and pandemic concerns weighed on sentiment.
Tokyo’s benchmark rose after economic growth for the April-June quarter was revised upward to an annualized 1.9% from an earlier estimate of 1.3%.
“Any feel-good factor was ignored, though, given the climb was less than half of the 4.20% fall in Q1,” Jeffrey Halley of Oanda said in a commentary. “Japan will be lucky to break even this year as the current Covid-19 wave will almost certainly have weighed on domestic consumption,” he said.
Germany’s DAX lost 1.5% to 15,599.69 and the CAC 40 in Paris declined 1.4% to 6,630.07 In London, the FTSE 100 gave up 1.1% to 7,072.28, The future for the Dow industrials shed 0.5% and that for the S&P 500 slipped 0.4%.
In Asian trading, Japan’s Nikkei 225 index rose 0.9% to 30,181.21, while the Hang Seng in Hong Kong shed early gains, falling 0.1% to 26,320.93. The Shanghai Composite index gave up 1.4 points to 3,675.19. In Seoul, the Kospi lost 0.8% to 3,162.99. Australia’s S&P/ ASX 200 lost 0.2% to 7,512.00.
Japan’s ruling Liberal Democratic Party is due to elect a new prime minister to succeed Yoshihide Suga, adding to uncertainty over future policy, but fresh stimulus for the world’s thirdlargest economy is expected in the coming weeks, analysts say.
On Tuesday, U.S. traders returned from the Labor Day holiday weekend to a relatively light week of economic data, after the last big economic snapshot, the August jobs report, came in weaker than expected last Friday.
“Scratching my head to make sense of it all, it appears that U.S. markets are concerned about the hoped-for postpandemic recovery being somewhat less exuberant than hoped,” Halley said.
Volatility is expected to pick up in the coming days and weeks, after stocks churned higher throughout the summer, helped by stronger-than-expected earnings from big companies and guidance from the Federal Reserve that the central bank plans to keep interest rates low.
On Wednesday, the Labor Department will report job openings for July. The jobs market is still struggling to recover from the pandemic and employers have been finding it difficult to fill openings amid lingering health fears and the resurgent virus could make it even more difficult.