NEW YORK (AP) – Nerves were fraying on Wall Street on Tuesday after two reports on the economy came in weaker than expected.
The S&P 500 was 0.7% lower in mid-day trading. The Dow Jones Industrial Average was down 259 points, or 0.8%, at 33,341 as of 12:05 am Eastern time, while the Nasdaq composite was 0.6% lower.
Investors are still wondering whether the US economy will fall into recession and how badly corporate profits will drop. The biggest question remains what the Federal Reserve will do with interest rates next year, after hiking them frantically for the next year to keep inflation under control.
Reports on job openings and factory orders released Tuesday have raised fears of a possible recession. But they can also account for the H account to keep rates stable at their next meeting in May for the first time in more than a year, providing a possible upside market.
One report showed employers posted 9.9 million job openings in February, a sharper fall than economists expected. The H in the numbers is noteworthy because the job market has remained so strong despite higher buys. The hope is that the relaxation in the number of openings can take some pressure off inflation, without putting many people out of work.
A separate report showed factory orders weakened more than economists expected in February. That H could give another reason for hiking rates to slow down again to hit inflation, which has slowed but remains too high.
What makes H so sticky on Wall Street is that it is important to cut higher rates by slowing growth throughout the economy, which raises the risk of a recession. The prices of timber, bonds and other commodities are also hurt.
Investors in the United States business markets are getting three reports this week from the government. Thursday is the weekly report on the number of workers applying for unemployment benefits. On Friday, the largest monthly update on the number of jobs created across the country will be released.
Some relatively encouraging data on inflation coming from other parts of the world on Tuesday. In Europe, a survey by the European Central Bank showed inflation expectations in the coming year among consumers in the country falling. The key is that lower expectations can help the economy avoid a vicious cycle where inflation keeps building momentum.
A separate report also showed that headline inflation in the country slowed more than economists expected in February.
in Australia the central bank of the country kept its key interest rate unchanged at 3.60%. He said he wanted some time to see how his past hikes in interest rates worked through the system.
While Australia’s economy is much smaller than that of the US or the European Union, its central bank and New Zealand’s tend to “balance the tone of financial cycles” Ipek Ozkardeskaya swissquote.com it is said in the comment.
In South Korea, the consumer inflation rate fell earlier than expected in March. That has raised expectations that the central bank will keep its key rate steady when it meets next week.
In the US, traders flipped bets back towards H holding rates steady at their meeting last month. The day before, a slightly larger portion was another increased amount of betting money. What you have helped to do is cause the bond market to fall.
The yield on the 10-year Treasury note fell to 3.35% from 3.42% late Monday. It helps with rates for mortgages and other important loans. The two-year Treasury yield, which leans more toward expectations for H, dropped to 3.84% from 3.97%.
Longer term, there seems to be confidence on Wall Street that H rates will have to fall later this year.
That has helped lift stocks, especially technology and other high-growth companies, because rate cuts act like steroids to markets. But the consonant H said he does not expect to make the cut this year.
Critics are also skeptical, saying inflation is still too high for H’s favor. And any cut in rates would only happen if the economy was in much weaker shape, which could also torpedo stocks.
Tuesday’s weaker-than-expected economic readings follow a report on Monday that showed US manufacturing continued to shrink faster than economists had forecast.
Given such weakness, this is “not the time to chase growth,” said Mark Haefele, chief investment officer at UBS Global Wealth Management.
On Wall Street, shares of Virgin Orbit sank 23.6% to 15 cents after the company filed for Chapter 11 bankruptcy protection. This year he was struggling with a failing mission and the difficulty of raising funding for future missions.
Oil prices gave back some of their big gains from the day before, when they shot higher on concerns about tighter supplies. Saudi Arabia and other oil-producing countries said over the weekend that they would cut production in May.
Benchmark U.S. crude fell 0.4% to $80.07 per barrel, showing a slight decrease in growth. Brent crude, the international benchmark, fell 0.6% to $84.41 per barrel.
AP Business Writers Elaine Kurtenbach and Matt Ott contributed.
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