Stock markets today: Nasdaq leads stocks lower after mixed jobs and economic data, oil spikes on Iran report

US stocks slipped deep into the red on Tuesday as investors assessed a fresh batch of economic data. Meanwhile, reports that Iran is preparing a possible missile strike against Israel sent bond yields lower and crude oil prices higher (CL=F).

The Dow Jones Industrial Average (^DJI) fell roughly 0.5%, while the S&P 500 (^GSPC) fell nearly 1% as both major indexes capped the last quarter with fresh record highs. The tech-heavy Nasdaq Composite ( ^IXIC ) extended losses in early trading, falling about 1.7%.

New jobs and manufacturing data kicked off the new quarter as investors searched for more clues about the future of the Federal Reserve's easing cycle after Fed Chair Jerome Powell signaled the central bank was in no rush to cut rates quickly.

Job openings rose surprisingly in August, adding to the narrative that while the labor market is cooling, it's not slowing down quickly. New data showed 8.04 million job openings at the end of August, up from 7.71 million seen in July.

Meanwhile, US manufacturing was steady in September. The Institute for Supply Management (ISM) said its manufacturing PMI was unchanged at 47.2 last month. Despite holding steady, the reading was still weak, as a PMI below 50 indicated a contraction in the manufacturing sector.

Read more: What Fed Rate Cuts Mean for Bank Accounts, CDs, Loans and Credit Cards

The data set investors up for Friday's September jobs report, the highlight of a week full of closely watched economic data. Investors are looking for confirmation that the US economy is cooling rather than collapsing.

Meanwhile, a strike by dockworkers on the East and Gulf coasts had begun, threatening to shut down half of the ocean shipping in the United States. Disruption from large-scale shutdowns could cost the economy billions of dollars a day, raise inflation, put jobs at risk, and reverberate through U.S. politics.

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Tue, Oct 1, 2024 at 9:35 am PDT

Sector Watch: Energy, Utilities Lead While Tech Lags

Energy ( XLE ) and utilities ( XLU ) led Tuesday's sector action, up about 1.8% and 0.4%, respectively.

Crude oil (CL=F) traded below $71 a barrel on Tuesday morning after headlines circulated that Iran was preparing a missile strike against Israel. Brent (BZ=F), the international benchmark price, settled north of $74.

Meanwhile, the utilities sector, one of the most defensive parts of the economy, has seen a boost in recent months amid the artificial intelligence boom. It is also seen as a hedge against a possible economic downturn.

Technology ( XLK ) was the day's biggest laggard, with the Nasdaq Composite down nearly 2% in afternoon trading. In tech, Apple ( AAPL ) and Nvidia ( NVDA ) are two of the biggest losers. Both stocks fell more than 3%.

(Courtesy: Yahoo Finance)
Tue, Oct 1, 2024 at 8:41 am PDT

A port strike poses risks but here's why it may not fuel inflation

A strike by dockworkers along the East and Gulf coasts began early Tuesday morning, threatening to shut down half of US ocean shipping and cost the economy billions of dollars a day.

“If it lasts more than a few days or a week, you're going to have massive cascading effects,” Flexport founder and CEO Ryan Petersen said of Yahoo Finance's market dominance before the strike began.

He noted that 15% of the world's container ships could be taken offline, leading to a “massive reduction in capacity” and potentially a supply chain disruption “much worse” than the US economy experienced during the pandemic.

But Eugenio Aleman, chief economist at Raymond James, predicted that the strike would not boost inflation, a top concern as the stoppage officially continues.

“While the strike will affect ~40% of US container volume and comes at a bad time before the important holiday shopping season and elections, it should not materially fuel inflation like port shutdowns in 2021-2022,” Aleman said in a message. New notes on Tuesday.

“The reason: slowing consumer demand. Slower job growth, more prudent consumers, and an expected cooling in housing costs should limit the upside.”

Read about the strike and what it could mean for the economy, politics and more.
Tue, Oct 1, 2024 at 7:51 am PDT

Oil prices rise on Iran missile attack headlines

Oil prices rose on Tuesday morning following headlines that Iran was preparing missile strikes against Israel.

West Texas Intermediate (CL=F) rose nearly 3% to trade above $70 a barrel. Brent (BZ=F), the international benchmark price, also rose nearly 2% to below $74 a barrel.

“The United States has indications that Iran is preparing to launch a rapid ballistic missile attack against Israel,” a senior White House official said in a statement cited by multiple outlets. “We are actively supporting defensive preparations to defend Israel against this attack. A direct military strike from Iran against Israel would have dire consequences for Iran.”

Tensions have risen in the Middle East in recent days after Israel launched a ground operation in southern Lebanon targeting the Iran-backed militant group Hezbollah.

A possible missile strike, along with mixed jobs and economic data released earlier Tuesday, sent stocks tumbling, with the tech-heavy Nasdaq leading the decline.
Tue, Oct 1, 2024 at 7:04 am PDT

Job opportunities increase in August, discount rates decrease

Job openings rose surprisingly in August, adding to the narrative that while the labor market is cooling, it's not slowing down quickly.

New data from the Bureau of Labor Statistics released Tuesday showed 8.04 million job openings at the end of August, up from 7.71 million seen in July. Economists polled by Bloomberg had expected the report to show job openings rose slightly to 7.67 million in August.

The July figure was revised higher from the 7.67 million open jobs initially reported.

The Job Openings and Labor Turnover Survey (JOLTS) showed 5.31 million were hired in the month, down from 5.41 million in July. The hiring rate hit 3.3% in August, down from 3.4% in July. Also in Tuesday's report, the job quit rate, a measure of confidence among workers, fell to 1.9%, its lowest level since June 2020.
Tue, Oct 1, 2024 at 6:34 am PDT

Stocks off slow October start

U.S. stocks ended lower on Tuesday to open the first trading day of October and the fourth quarter.

The Dow Jones Industrial Average (^DJI) fell roughly 0.4%, while the S&P 500 (^GSPC) fell about 0.3% after both major indexes closed at a new record on Monday. The tech-heavy Nasdaq Composite (^IXIC) also edged lower, down around 0.3%.
Tue, Oct 1, 2024 at 6:19 am PDT

Stellantis stock further reduces Jeep recall over fire risk

Jeep-maker Stellantis ( STLA ) fell 1% in premarket trading Tuesday after it issued a recall for more than 150,000 hybrid Jeep SUVs over a “potential fire risk.”

The drop in Stellantis shares comes just a day after the stock fell 12.5% in response to the automaker's gloomy outlook for its North American operations. Stellantis – which also makes Dodge and Ram cars – said it expects to record a profit margin of 5.5% to 7% for the full year, instead of previous double-digit guidance. As the weather worsens in the global auto industry, automakers plan cost-cutting measures and discounts, Yahoo Finance reporter Pros Subramanian explains about market dominance.

Meanwhile, the newly issued recall affects the 2020-2024 Jeep Wrangler 4xe and 2022-2024 Jeep Cherokee 4xe SUVs. The agency said it had linked 13 fires to an internal investigation, but it estimated that only 5% of the recalled vehicles exhibited a fire hazard.
Tue, Oct 1, 2024 at 5:47 am PDT

Barclays didn't pull any punches on Apple

Barclays analyst Tim Long dropped the mic on Apple ( AAPL ) in a new note this morning, calling out weak demand for the iPhone 16.

Here's what Long had to say:

“There was a lot of news about iPhone growth in early July, a few weeks after the launch of Apple Intelligence. Based on our recent supply chain channel checks, we believe AAPL cut about 3 million units in a key semiconductor component. iPhones for the December quarter, which confirmed If done, it would be the earliest build cut in recent history.Our sales were down 15% in the first week of global iPhone 16 sales across global geographies, indicating significantly lower wait times for the IP16 than in the major geographies we track, although last year the IP15 Pro Supply chain constraints in the models point to potential weakness. -All of the above data points to softer-than-expected demand, particularly across the US and China.”

Long reiterated an Underweight rating on Apple (Sell Equivalent).