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Stock prices lose momentum despite strong December employment report

The Elite Times TeamBy No Comments8 Mins Read

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Stocks were volatile Friday afternoon as investors digested stronger labor market data that weighed on interest rate cut expectations.

The Dow Jones Industrial Average (^DJI) fell below the flatline in afternoon trading. The benchmark S&P 500 Index (^GSPC) rose 0.1%, and the tech-heavy Nasdaq Composite Index (^IXIC) rose about 0.2%.

Major indexes trended in both directions throughout the day following the release of the December U.S. jobs report, with the U.S. economy adding 216,000 jobs in December, more than economists expected by 175,000. The unemployment rate remained unchanged at 3.7%.

Separate data released by the Institute for Supply Management (ISM) showed service activity slowed in December. Services PMI for the month was 50.6, down from 52.7 in November. While numbers above 50 indicate expansion, December’s numbers were the lowest for service activity since May.

Stocks fell in the first week of 2024, a notable reversal from explosive gains fueled by expectations that the Federal Reserve would soon begin monetary easing. But there are questions about whether policymakers are ready to change course.

read more: Impact of the Fed’s interest rate hike suspension on bank accounts, CDs, loans, and credit cards

Against this backdrop, U.S. Treasury yields continued to rise, with the 10-year Treasury yield (^TNX) rising about 6 basis points to 4.05% after rising sharply on Thursday.

Elsewhere, iPhone supplier Foxconn (2354.TW) said it expected first-quarter sales to decline due to slowing market demand. Apple (AAPL) stock fell in afternoon trading, widening its losses after two analysts downgraded the iPhone maker over concerns about sales of its next smartphone.

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  • Maersk reroutes operations from Red Sea

    Container shipping giant Maersk (MAERSK-A.CO, MAERSK-B.CO) has announced that it will reroute all of its shipping vessels away from the Red Sea following attacks on shipping vessels by Yemen’s Houthi forces in the Gulf region.

    The detour is significant given the importance of the route connecting Asia and Europe through the Suez Canal. Approximately 10% of world trade passes through waterways.

    Alternative routes increase transportation costs by more than 170% and lengthen the voyage by up to 14 days.

    “The situation is constantly evolving and remains highly volatile, and all available information confirms that the security risk remains at an extremely high level,” Maersk said in a statement Friday. “There is,” he said.

    Yahoo Finance’s Ines Ferré reports that analysts at Goldman Sachs and Bank of America are anticipating geopolitical tensions to boost shipping companies’ earnings outlook as shipping capacity declines. upgraded Maersk from underweight to neutral this week.

    Oil prices also soared due to supply disruptions. West Texas Intermediate crude oil (CL=F) rose 2% Friday afternoon, while Brent crude oil (BZ=F) rose nearly 1.4%.

  • Stock prices rise in afternoon trading

    Here are some of the leading stocks on Yahoo Finance. trend ticker Trading page on Friday afternoon:

    Peloton (Pton): The connected fitness company’s stock continued to rise Friday afternoon, riding the momentum after the company announced a partnership with TikTok that will feature Peloton content in a dedicated fitness hub on the social media platform.

    Palantir (PLTR):The stock fell 2% after Jefferies downgraded the stock from “hold” to “underperform” and lowered its price target from $18 to $13 per share. Jefferies analyst Brent Till wrote that Palantir still has a long-term AI advantage through a trend of “AI euphoria.”

    sign: (STZ) — The parent company behind popular beer brands Modelo and Corona rose 2% Friday afternoon after announcing overall sales fell short of expectations for third-quarter profit, but beer profits declined and boosted sales growth.

    Costco (Fee): Shares rose 1% after the warehouse retailer reported net sales rose nearly 10% last month, driven by nearly 18% growth in e-commerce sales. Bank of America also reiterated its “buy” rating on the wholesaler’s stock.

  • Stocks were mixed in afternoon trading.

    Investors tried to gain footing in Friday afternoon trading after the release of the December jobs report. The major indexes moved in both directions early in the day before settling in mixed territory.

    At around 12:30 p.m. ET, the Dow Jones Industrial Average (^DJI) was down 0.2%, or about 75 points. The benchmark S&P 500 index (^GSPC) was more than flat, and the tech-heavy Nasdaq Composite Index (^IXIC) rose 0.1%.

    “December employment data continues to show gradual cooling in the labor market, consistent with a soft landing rather than a recession,” Bank of America global research analysts said in a Friday note. “There is,” he said.

  • OpenAI aims for more licensing deals with publishers

    The maker of the popular AI chatbot ChatGPT is in talks with dozens of publishers to license its articles, Bloomberg reported on Thursday. The deal will help startups train their own AI models and pay publishers for the content they produce.

    The push to expand the licensing agreement comes after the New York Times filed suit against Microsoft (MSFT) and OpenAI for alleged copyright infringement. The news organization alleges that an AI company has hijacked and extensively copied The Times’ journalism in order to train an AI chatbot. The case is the latest in a broader debate over how courts should view the legality of using copyrighted material published on the web to train large-scale language models without permission or compensation. It is.

    Some publishers have already struck deals with OpenAI and other AI companies, but the Times has publicly challenged how tech companies are training their AI tools, and the creatives It is one of the media.

    “We’re in the middle of a lot of negotiations and discussions with a lot of publishers. They’re active and very positive. Things are going well,” said Tom, Head of Intellectual Property and Content at OpenAI. Rubin told Bloomberg. “There have been deals announced and more will be announced in the future.”

    Regardless of how these deals play out, advocates for independent creators have expressed concern that small media production professionals will be locked out of potential licensing deals. And without intervention from Congress or the courts, artists for hire have little recourse to challenge AI companies, even if their work is fed into large-scale language models, says stock footage firm Nautilus.・Rick Allen, co-founder of Productions, said: And the production house.

    “These negotiations by OpenAI, which fiercely protects its intellectual property, demonstrate that it recognizes the value of other people’s content,” he said.

  • Investors expect interest rate cuts despite strong jobs report

    The latest labor market data surprised Wall Street.

    The labor market added 216,000 jobs in December, up from 173,000 the previous month and above the 175,000 expected by economists polled by Bloomberg.

    On the surface, this data reflects good news for workers and the companies that employ them, but the robust numbers also complicate expectations for the Federal Reserve’s interest rate policy in the coming months.

    “Friday’s jobs report was so strong that it will likely delay the Fed’s final interest rate cut,” said Jeremy Straub, CEO of Coastal Wealth. said. “It’s clear at this point that the economy is strong enough to withstand the Fed’s current interest rate increases.”

    For many on Wall Street, the end of the Fed’s tightening campaign would be a victory for the economy, especially investors weighed down by rising interest rates that increase borrowing costs and limit growth.

    While the positive jobs report may have initially dampened expectations for a rate cut, investors are still leaning on the possibility of the Fed cutting rates at its March 20th meeting.

    Investors are pricing in about a 74% chance of a rate cut after the March meeting, according to the CME FedWatch tool.

  • Stocks rise slightly after strong jobs report surprised Wall Street

    Stocks opened slightly higher on Friday as investors searched for direction after a strong jobs report dented expectations for a Federal Reserve rate cut.

    The surprisingly strong jobs report could put pressure on the Fed to keep interest rates on hold and delay its first rate cut, potentially discouraging hopes that the tightening campaign is over.

    The Dow Jones Industrial Average (^DJI) rose just above the flatline. The benchmark S&P 500 Index (^GSPC) rose 0.3%, and the tech-heavy Nasdaq Composite Index (^IXIC) rose 0.2%.

  • US economy adds 216,000 jobs in December, stocks fall

    The U.S. economy added 216,000 jobs in December, but the unemployment rate remained unchanged at 3.7%, according to the Bureau of Labor Statistics.

    Yahoo Finance’s Josh Schafer has all the details here.

    Stocks fell on the news as traders scaled back bets that the Federal Reserve would cut interest rates. All three indexes fell more than 0.4% in pre-market trading.

For the latest stock market news and in-depth analysis of price-moving events, click here.

Read the latest financial and business news from Yahoo Finance

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