Wall Street continues to slide, not inspired by US employment figures

The New York Stock Exchange continued its tumble on Friday the day after its worst session since 2020, in a market uninspired by a mixed US employment report.

Around 2:05 p.m. GMT, the Dow Jones conceded 1.29%, the Nasdaq index, with a strong technological composition, lost 2.06%, and the broader S&P 500 index, 1.56%.

Thursday, the New York market had plunged, worrying again about the monetary trajectory of the American central bank (Fed), as well as geopolitical and economic uncertainty.

“Markets continue to question whether the Fed can successfully bring the (US) economy to a soft landing,” Schwab analysts wrote in a note.

Cut by nearly 5% on Thursday, the Nasdaq now shows a loss of more than 25% since its highest end of November.

Already targeted on Thursday, the largest capitalizations of the rating, all technology stocks, remained clearly in the red, like Amazon (-1.54%), Tesla (-0.56%), via Nvidia (-1.02%) or Alphabet (-1.17%).

The VIX index, which measures market volatility, was up another 12%, up 34% over two days.

Still digesting the Fed’s announcements on Wednesday, bond rates were still climbing a bit. The yield on 10-year US government bonds rose to 3.12%, then fell to 3.06%.

Traders weren’t thrilled with the monthly US jobs report.

First seduced by the 428,000 job creations in April, better than the 380,000 expected, they then saw less encouraging elements.

The downward revision of 39,000 for the month of March thus tempered the April figure.

“A downward revaluation suggests a change of pace” in the job market, decrypted, in a note, Chris Low, of FHN Financial, while the specter of an economic slowdown has been hovering for several weeks already.

In addition, economists have expressed concern about a slight decline in the labor force participation rate (ratio between people employed or looking for work and the population of working age).

This is “a worrying sign for companies facing one of the tightest job markets in decades,” said Peter Essele of Commonwealth Financial Network.

“There’s nothing in there that can steer the Fed one way or another,” he nevertheless concluded, Chris Low.

For Peter Cardillo, of Spartan Capital, the continuation of the decline of Wall Street is above all linked to technical factors. “The S&P index is at a crucial level,” he explained, and is about to test the threshold of 4,100 points.

If it manages to close above this level, “it might relieve the market a bit,” he said. In fact, after an initial skid, the indices rebounded slightly around 2:00 p.m. GMT.

On the side, the payment services specialist Block (ex-Square), led by the former boss of Twitter, Jack Dorsey, suffered a downpour (-5.86% to 89.95 dollars), after reporting results below expectations.

The DoorDash meal delivery platform was leaked (-8.98% to 66.58 dollars) despite higher than expected turnover, investors dwelling on the continued deceleration of its growth, after vintages 2020 and 2021 boosted by the pandemic.

Under Armor was tackled by investors (-24.98% to 9.98 dollars) after results and forecasts deemed disappointing. The sports equipment manufacturer anticipates a drop in its margins as well as a loss of growth of around 3 percentage points due to supply problems.

The session was announced to be gloomy (-10.58% to 15.21 dollars) for the specialist in exercise bikes and connected treadmills Peloton, which would be looking for investors ready to take a minority stake of around 15 to 20%, according to the Wall Street Journal, to bail out the coffers of the group, currently in difficulty.