Stock market today: Wall Street opens higher following signal that labor market is cooling
Sep 1, 2023, 1:19 AM | Updated: 6:46 am
NEW YORK (AP) — Stocks are opening higher on Wall Street after a closely watched report showed that the job market, while still healthy, has been showing some signs of cooling. That’s leading markets to hope that the Federal Reserve can soon ease up on its campaign to slow down the economy by raising interest rates. The S&P 500 was up 0.4% in the early going. The index is coming off its first monthly loss since February. The Dow rose 144 points, or 0.4%, and the Nasdaq composite was up 0.2%. The yield on the two-year Treasury note eased back to 4.81%.
THIS IS A BREAKING NEWS UPDATE. AP’s earlier story follows below.
Wall Street followed global markets higher Friday with strong U.S. jobs data boosting shares.
Futures for the Dow and S&P 500 each rose about 0.4% before the bell.
US employers added a solid 187,000 jobs in August, showing how resilient the U.S. labor market is despite an extended campaign by the U.S. Federal Reserve to cool hiring and inflation.
The strong job market, along with consumer spending, has so far helped thwart a recession that analysts expected at some point in 2023. But they also made the Federal Reserve’s task of taming inflation more difficult by fueling wage and price increases.
Market jitters over the possibility that the Federal Reserve might have to keep interest rates higher for longer — following reports showing the U.S. economy remains remarkably resilient — led to the market’s pullback in August after what had been a banner year.
The central bank has raised its main interest rate aggressively since 2022 to the highest level since 2001. The goal has been to rein inflation back to the Fed’s target of 2%. The Fed has maintained that it is ready to keep raising interest rates if it has to, but will base its next moves on the latest economic data.
Broadcom shares slid close to 4% after the chipmaker posted earnings that beat forecasts, but left investors lukewarm about the near term.
Walgreens Boots Alliance ticked down less than 1% after the company announced that CEO Rosalind Brewer was stepping down at the end of the month and that Ginger Graham would take over as interim CEO.
Oil prices climbed again as production cuts by major producers continue to prop up the market. Benchmark U.S. crude rose 96 cents to $84.59 a barrel. Brent crude, the international standard, added $1 to $87.83 a barrel. U.S crude is up 6% this week.
Many industry analysts are expecting to Saudi Arabia to extend those cuts through October.
Earlier this month, Saudi Arabia said it would extend its unilateral production cut of 1 million barrels of oil a day through the end of September in its effort to boost flagging energy prices. The Saudi cut of 1 million barrels per day, which began in July, came as the other OPEC+ producers have agreed to extend earlier production cuts through next year.
Since Saudi Arabia’s July cut — which amounts to about 10% of its daily output — oil prices are up nearly 20%.
In Europe at midday, France’s CAC 40 edged up 0.3%, while Germany’s DAX was little changed. Britain’s FTSE 100 slid 0.5%.
Japan’s benchmark Nikkei 225 rose 0.3% to finish at 32,710.62. Australia’s S&P/ASX 200 slipped 0.4% to 7,278.30. South Korea’s Kospi added 0.3% to 2,563.71. The Shanghai Composite added 0.4% to 3,133.25.
Trading was halted in Hong Kong because of an approaching typhoon. Schools and businesses were shut as an official warning was issued about Super Typhoon Saola. Hundreds of flights were canceled or delayed.
In currency trading, the U.S. dollar edged down to 145.38 Japanese yen from 145.52 yen. The euro cost $1.0849, inching up from $1.0846.
Kageyama reported from Tokyo; Ott reported from Silver Spring, Md.