Wall Street Wobbles Ahead of Key U.S. Jobs Report
US stocks wobbled throughout Wednesday’s session and closed mostly in the red as a wave of upcoming economic data looms large.
These reports will play a crucial role in shaping the U.S. Federal Reserve's decision on interest-rate cuts and whether the economy is still on track for a soft landing.
Following the release of recent weak economic data, traders are leaning more heavily towards the likelihood of the U.S. Federal Reserve cutting interest rates by 50 basis points this month.
The Job Openings and Labor Turnover Survey (JOLTS) revealed a slight decline in job openings in July, with 7.67 million reported compared to 7.91 million in the previous month, missing the forecast of 8.09 million.
Wall Street eagerly awaits Friday’s jobs report, which could impact the Federal Reserve's rate cut decisions and signal whether the economy is heading toward a recession or a soft landing.
A weak report could spike recession fears and send stocks tumbling, while a strong showing might provide relief.
Preliminary data from the New York Stock Exchange (NYSE) show the Dow Jones Industrial Average rose 38.04 points, or 0.09%, to 40,974.97.
The Standard & Poor's 500 Index lost 8.86 points, or 0.16%, to 5,520.07, while the rich-tech Nasdaq Composite fell 52.00 points, or 0.30%, to 17,084.30.
The 'Magnificent Seven' mega-cap tech stocks had a mixed performance, with Nvidia closing down 1.7% following a 9.5% drop on Tuesday, which was the largest one-day market-cap loss for any U.S. company on record.
Alphabet fell 0.5%, while Tesla rose 4.2%. Amazon dropped 1.7%, Meta (formerly Facebook) increased 0.2%, Microsoft declined 0.1%, and Apple fell 0.9%.
Meanwhile, Advanced Micro Devices rose nearly 3% after appointing former Nvidia executive Keith Strier as senior vice president of global AI markets.
Additionally, the Philadelphia SE Semiconductor Index rebounded from its largest one-day drop since the COVID-19 pandemic in the previous session, ending up 0.25%.
In the U.S. government bond markets, the yield on the 10-year Treasury, which influences mortgage rates and other economy-influencing loans, settled at 3.75%.
The policy-sensitive two-year yield, which closely tracks Federal Reserve interest rate adjustment expectations, closed at 3.77%.
Bitcoin, the largest digital currency, recovered much of its early losses, trading between US$55,732 and US$58,508 before closing at US$58,083 in New York.
Although the bullish bias remains after clearing the US$62,400 hurdle, traders should closely monitor technical indicators for potential rallies or pullbacks.
However, with Bitcoin closing below the US$58,350 mark, the current bullish sentiment could reverse, shifting the focus towards the downside.
Initial support is seen at US$54,600, and further support is US$48,000.
However, further assessment is needed to confirm this bearish outlook.
Meanwhile, if a bounce occurs, the next major target of US$71,500 will be a significant challenge, potentially extending the rally towards the upper range of US$78,000 to US$81,000.
Effective risk management and adaptable strategies are essential for navigating market volatility and seizing potential opportunities.
Ethereum mirrored Bitcoin's volatility, trading between US$2,317 and US$2,488 and closing at US$2,462.
To restore its bullish momentum and target US$4,000 despite recent volatility, Ethereum must close above US$2,870.
Clearing this level is critical for sustaining the bullish outlook and making further gains.
Support is now seen at around US$1,950–US$1,980; reassessment at this level is suggested.
Given the high volatility, traders should remain cautious, monitor prices closely, and apply effective risk management and adaptable strategies to navigate the market and capitalise on potential opportunities.
Precious metal prices remained volatile, with Spot Gold flat at US$2,495 and Silver closing at US$28.26.
In the energy sector, oil prices remained weak, with Brent crude, the global benchmark, falling to $72.70, while the U.S. benchmark, West Texas Intermediate, closed at $68.86.
Meanwhile, the U.S. Dollar Index (DXY) reversed course and fell from 101.75 to 101.30.
Meanwhile, the Eurodollar was 1.1080, and the British pound finished at 1.3144. The Japanese yen ended lower at 143.64, and the Australian dollar was at 0.6720.
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