The U.S. Labor Department announced on Friday (3rd) that the non-farm payrolls report for May was far better than expected, reinforcing expectations of aggressive interest rate hikes by the Federal Reserve. The dollar strengthened, gold prices fell, U.S. bond yields rose, oil prices rose for six consecutive weeks, and energy stocks Thriving, Tesla collapsed by more than 9% after it was reported that it planned to lay off employees, dragging down the consumer discretionary sector, technology stocks fell with Apple, the four major indexes closed in the dark, and the Dow Jones fell nearly 350 points.
Elon Musk, the world’s richest man, has joined the latest “bad boy”, Reuters reported on Friday, saying he has a “super bad feeling” about the economy. ”, U.S. President Joe Biden dismissed it on Friday and wished Musk good luck on his trip to the moon.
The pessimistic atmosphere in the market prompted the major indexes of U.S. stocks to decline this week. The Dow Jones fell 0.94%, the Nasdaq fell 0.98%, and the S&P fell 1.2%. The fee was the worst, with a weekly decline of 1.69%.
In terms of economic data, the U.S. Department of Labor announced on Friday that non-farm payrolls rose to 390,000 in May, far better than market expectations of 325,000. The unemployment rate remained steady at 3.6%, unchanged from April and slightly higher than in 1969. The labor force participation rate climbed to its lowest level since December.
The better-than-expected non-farm payrolls report underscored that job growth remained healthy and provided a boost for the Federal Reserve to raise interest rates aggressively. Following the non-farm payrolls report, CME Group’s FedWatch tool showed on Friday that investors in federal funds futures forecast a more than 70 percent chance that the Fed will raise rates by more than 2 yards in September.
Cleveland Fed President Loretta Mester said on Friday she did not think the U.S. economy was heading for a “hurricane,” but had to admit that the risk of a recession had risen. There is not enough evidence that inflation has peaked to support multiple rate hikes in the coming months.
The global epidemic of new coronary pneumonia (COVID-19) continues to spread. Before the deadline, data from Johns Hopkins University in the United States pointed out that the number of confirmed cases worldwide has exceeded 531 million, and the number of deaths has exceeded 6.29 million. More than 11.9 billion vaccine doses have been administered in 184 countries worldwide.
The performance of the four major U.S. stock indexes on Friday (3rd):
Focus stocks
The five kings of science and technology have all fallen. Apple (AAPL-US) fell 3.86%; Meta (formerly Facebook) (FB-US) fell 4.06%; Alphabet (GOOGL-US) fell 2.62%; Amazon (AMZN-US) fell 2.52%; Microsoft (MSFT-US) ) fell 1.66%.
More than half of the Dow Jones components ended in the dark. Traveller (TRV-US) fell 2.17%; Disney (DIS-US) fell 1.98%; Salesforce (CRM-US) fell 1.85%; Nike (NKE-US) fell 1.75%; UnitedHealth (UNH-US) rose 1.35 %.
Half of the constituent stocks of the fee were all closed. Intel (INTC-US) fell 3.23%; Applied Materials (AMAT-US) fell 2.02%; Micron (MU-US) plunged 7.20%; Texas Instruments (TXN-US) fell 2.48%; AMD (AMD-US) fell 2.11 %; NVIDIA (NVDA-US) fell 4.45%; Qualcomm (QCOM-US) fell 3.41%.
Taiwan stocks ADR fell together. TSMC ADR (TSM-US) fell 2.67%; ASE ADR (ASX-US) fell 2.33%; UMC ADR (UMC-US) fell 2.95%; Chunghwa Telecom ADR (CHT-US) fell 0.69%.
Corporate News
Tesla Chief Executive Elon Musk had a “super bad hunch” about the economic outlook, saying Tesla would need to cut about 10% of its workforce and suspend hiring, according to internal emails obtained by Reuters. Tesla (TSLA-US) collapsed 9.22% to $703.55 a share, other electric truck makers were also dragged lower, with Nikola (NKLA-US) plummeting 8.14%. Electric pickup truck maker Rivian (RIVN-US) tumbled 5.48%.
Cryptocurrency trading platform Coinbase (COIN-US) tumbled 9.66% to $66.69 a share on Friday. Affected by macroeconomic factors, Coinbase said it will extend the freeze on recruitment and cancel some of the admission notices that have been issued.
Twitter (TWTR-US) edged up 0.63% to $40.16 a share. Twitter announced on Friday that the HSR (Hart-Scott-Rodino) review waiting period for Musk’s acquisition of Twitter, a condition of closing the deal, has passed, meaning a major hurdle has been lifted.
Exxon Mobil (XOM-US) rose 1.47% to $99.09 a share on Friday, driven by higher oil and gas prices and upbeat comments from analysts. Phil Gresh, an analyst at JPMorgan Chase, said in a report that Exxon Mobil has completely turned to capital discipline and returned to a strong position on the balance sheet, and the company’s operating conditions have improved significantly.
Micron (MU-US) tumbled 7.20% to $69.94 a share on Friday. Investment bank Piper Sandler downgraded the company to “underweight,” citing pricing pressure and weak demand for Micron.
Amazon (AMZN-US) fell 2.52% to $2,447.00 per share. Amazon announced on Thursday that it will stop operating its Kindle e-bookstore in China from the end of June next year. In addition, it is worth noting that after Amazon announced a 20-to-1 stock split on March 9, next Monday (6th) will be the first trading day for the split to take effect.
Economic data
- U.S. non-farm payrolls reported 390,000 in May, compared with an expected 325,000, and the previous value was raised to 436,000 from 428,000
- The U.S. unemployment rate reported 3.6% in May, expected 3.5%, the previous value of 3.6%
- The average weekly working time in the United States in May was 34.6 hours, expected 34.6 hours, and the previous value was 34.6 hours
- U.S. annual average hourly wage growth in May was 5.2%, expected 5.2%, and the previous value of 5.5%
- U.S. average hourly wages rose 0.3% month-on-month in May, expected 0.4%, and the previous value of 0.3%
- The U.S. labor force participation rate in May reported 62.3%, expected 62.3%, the previous value of 62.2%
- US May Markit services PMI final value at 53.4, expected 53.5, the previous value of 53.5
- US May Markit composite PMI final value reported 53.6, expected 53.8, the previous value of 53.8
- US May ISM non-manufacturing index reported 55.9, expected 56.4, the previous value of 57.1
Wall Street Analysis
Glassdoor senior economist Daniel Zhao said that despite the slight cooling, the tight labor market is clearly still there, and shrugging off fears of an economic downturn, it continues to see signs of a healthy, competitive job market that hasn’t stepped up yet. brake signs.
In response to the retail employment data loss of 61,000, Drew Matus, market strategist at MetLife Investment Management, commented that this does not match the desire of consumers to spend money on goods. The situation of accommodation and food services shows that people have shifted from spending on goods to Service spending, the real question is how long can they last?
David Wagner, portfolio manager at Aptus Capital Advisors on Friday, predicted continued market volatility ahead, driven by a shift from quantitative easing to quantitative tightening and expectations that inflation has not yet peaked.
Unless the Fed can rein in inflation without a hard landing for the economy, the second half of 2022 will be very volatile for investors as recession fears pervade, said Peter Essele, director of portfolio management at Commonwealth Financial Network. The stock market has failed to form any positive moves, and most investors seem to be betting on a crash for now.
The figures are updated before the deadline, please refer to the actual quotation.
