US Stock Market Falls Amid Economic Concerns and Nvidia’s Decline

Major US stock index futures prices are falling across the board before the opening of the New York Stock Exchange, with shares of semiconductors and large technology companies, including Nvidia, leading the decline.

As of 8:20 a.m. ET, E-mini S&P 500 futures on the Chicago Mercantile Exchange (CME) were down 24.50 points, or 0.44%, at 5,517.25. E-mini Dow futures were down 80.00 points, or 0.20%, at 49,380. E-mini Nasdaq 100 futures were down 145.25 points, or 0.76%, at 18,861.25.

Causes of the Decline

The Institute for Supply Management (ISM) announced that its August manufacturing purchasing managers’ index (PMI) came in at 47.2, falling below 50 for the fifth consecutive month, rekindling concerns about an economic downturn. This news, combined with Bank of Japan (BOJ) Governor Kazuo Ueda’s remarks that the central bank will continue to raise interest rates if the economic and price outlooks turn out as expected, has weighed on investor sentiment.

Employment Indicators

This week, employment-related indicators are released one after another, starting with the Job Openings and Turnover Report (JOLTs) at 10 a.m. Eastern time. Weekly unemployment claims and the August Automatic Data Processing (ADP) employment report are released on the 5th, and the nonfarm payrolls report is released on the 6th.

Investors are particularly keen on the August employment report, which will be released on the 6th. Economists expect that August’s nonfarm payrolls will improve compared to July. However, if the employment market slows down further despite this prediction, the financial market is expected to increase expectations that the Federal Reserve (Fed) will lower interest rates by 50bp (1bp = 0.01% point) at its meeting on the 17th and 18th.

Nvidia’s Decline

Nvidia’s stock price is down 1.8% in pre-market trading on this day, following a Bloomberg report that the U.S. Department of Justice has sent subpoenas to Nvidia and others to investigate whether they violate antitrust laws. The previous day, Nvidia’s stock price plunged nearly 10%, wiping out $279 billion in market capitalization.

Other Stocks

Dollar Tree (DLTR), a U.S. discount retailer, is seeing its stock price fall by more than 10% after it lowered its annual sales and net income forecasts. Hormel Foods (HRL), famous for making Skippy peanut butter, is also seeing its stock price fall by more than 10% in after-hours trading after news that it has lowered its annual sales forecasts. Cybersecurity company Zscaler (ZS) is seeing its stock price plummet 17% after the company confirmed that its fiscal 2025 sales and net profit forecasts fell short of Wall Street’s expectations.

Market Trends

The US dollar is falling slightly, with the dollar index down 0.11% at 101.7. Treasury yields are falling across the board amid concerns about an economic slowdown. The 10-year Treasury yield was 3.821%, down 2.3 basis points from the previous session. The 2-year yield, which is sensitive to policy rates, was 3.3 basis points lower at 3.855%.