Stock Market Today: Wall Street hangs near its record after wild swings in Asian markets

NEW YORK (AP) — U.S. stocks hovered near record highs Monday after a wild start to the week for Asian financial markets, with Japanese stocks falling and Chinese indexes rising.

The S&P 500 was virtually flat in early trading, coming off its sixth winning week in the last seven. The Dow Jones Industrial Average retreated 155 points, or 0.4% Friday is the highest set ever. The Nasdaq Composite was up 0.2% as of 9:37 a.m. ET.

It was a break for Wall Street after its rally to a record, catapulted by expectations of a slowing US economy. can increase While the Federal Reserve Reduces interest rates It offers more juice. A big test will come Friday, when the U.S. government offers its latest monthly update on the job market.

An overriding concern on Wall Street is whether the economy is already headed for recession. Although the Fed cut rates earlier this month and hinted at more to come, US employers have already slowed their hiring pace. Earlier this month, the Fed left interest rates at a two-decade high in hopes of slowing the economy enough to stop high inflation.

Bank of America strategists and economists wrote in a BOFA Global Research report that “payrolls remain the biggest catalyst” for the US stock market leading up to the election.

At Goldman Sachs, economist David Mericle said he expected Friday's report to show a stronger 146,000 increase in September employment than economists across Wall Street had widely forecast.

In the past, a stronger-than-expected number could hurt stock markets by creating concerns about upward pressure on inflation. Now, though, it's likely to be welcomed as a signal that a recession shouldn't be as big of a concern.

Interest rates and the strength of the economy are usually the two main levers that determine prices for stocks. In Asia, the levers were pulling in the opposite direction.

Japan's Nikkei 225 fell 4.8% on reports that the country's incoming prime minister will support higher interest rates and other policies that investors see as less market-friendly. Shigeru Ishiba is set to take over on Tuesday.

Ishiba expressed support for the Bank of Japan to move interest rates away from their near-zero levels, which would put upward pressure on the value of the Japanese yen. A strong yen could hurt profits for Japanese exporters, who make sales in other currencies and then convert them into yen.

Toyota Motor stock fell 7.6% in Tokyo, while Honda Motor stock fell 7% on Monday.

Stellantis, the company that owns the Jeep brand and others, fell 13.7% later in Milan Cut his forecast for upcoming profits. It cited investments to turn around its US operations and increase Chinese competition.

Stock indexes sank broadly across much of Europe.

In China, meanwhile, indexes rose 8.1% in Shanghai and 2.4% in Hong Kong after the latest announcement of stimulus for the world's second-largest economy. It was the best day for Shanghai stocks in nearly 16 years.

China's central bank announced steps on Sunday to ease mortgage rates for existing home loans by October 31. Meanwhile, the major southern city of Guangzhou lifted all home-buying bans over the weekend, while both Shanghai and Shenzhen revealed plans to ease key purchase restrictions.

The moves followed a flurry of announcements last week from China's central bank and government aimed at propping up the world's second-largest economy, whose growth has flagged under the weight of a struggling real-estate sector.

Mainland markets will be closed from October 7 until Tuesday, a holiday marking 75 years of Communist rule in China.

In bond markets, the yield on the US 10-year Treasury rose to 3.76% from 3.75% late Friday. Two-year yields, which more closely track expectations of what the Fed will do with short-term rates, rose further. It rose to 3.60% from 3.56%.

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AP writer Jimo Zhong contributed.