Market Jitters: U.S. Manufacturing Data Sparks Stock Selloff Amid Economic Concerns”

Traders work on the floor at the New York Stock Exchange on June 3,
Traders work on the floor at the New York Stock Exchange on June 3, 2024.
Brendan McDermid | Reuters

US market 400 point downfall -Market Jitters: U.S. Manufacturing Data Sparks Stock Selloff Amid Economic Concerns”

Stocks stumbled on Monday following disappointing U.S. manufacturing data, stirring concerns about economic resilience. Sectors reliant on growth, such as banks and industrials, led the downturn.

The Dow Jones Industrial Average took a hit, shedding 400 points, approximately 1%, with notable losses from industry giants like Caterpillar and Goldman Sachs. The broader market, represented by the S&P 500, slipped 0.6%, while the Nasdaq Composite experienced a milder decline of 0.2%.

Worryingly, the U.S. manufacturing sector exhibited signs of deceleration, as indicated by the May reading of the ISM manufacturing index at 48.7, pushing Treasury yields downward. A figure below 50 suggests contraction, amplifying concerns about economic vitality.

Despite a robust prior month, where all major indices marked their sixth positive month out of seven, momentum faltered towards May’s close. Even with a surge of over 500 points in the Dow on Friday, all indices finished May more than 1% below their peak levels. The Nasdaq, particularly, stumbled by 1.1% during the week, with chip stocks like Nvidia facing headwinds.

Nvidia, however, managed to defy the market trend on Monday, climbing 2% after unveiling a new line of AI chips, succeeding its predecessor within just three months.

Chris Senyek, chief investment strategist at Wolfe Research, emphasized the stretched technicals, hinting at brewing volatility amid an optimistic sentiment backdrop.

The first week of June promises a flurry of economic updates, with anticipation mounting for Thursday’s private payroll data from ADP followed by Friday’s May jobs report. Investors seem to be in search of a sweet spot: economic moderation that grants the Federal Reserve room to maneuver on interest rates without stoking recession fears.

A technical snag at the New York Stock Exchange initially disrupted price quotes for several stocks earlier on Monday, but normalcy resumed around midday.

READ more here

DONT MISS:

Justin Jefferson Makes NFL History

Leave a Reply

Your email address will not be published. Required fields are marked *