Wall St.: Stocks drop broadly as job opening data push rates up

The S&P 500 was down 1.3% as of 10:40 a.m. The Dow Jones Industrial Average fell 249 points, or 0.8%, to 31,854 and the Nasdaq fell 1%.

Market Fed Chairman Jerome Powell indicated last Friday that the central bank would stick to its strategy of raising interest rates to try and contain the highest inflation in four decades.

Traders raised their bets on a third straight 75 basis point increase in September from 70% to 76.5%, ahead of the release of US job opening data today.

Wall Street is worried that the Federal Reserve may be putting the brakes on an already slowing economy too hard and slamming it into a recession. High interest rates also hurt investment prices, especially for expensive stocks.

Job openings unexpectedly jump to 11.2 million

US job openings unexpectedly rose in July after a massive upward revision over the past month, underscoring the continued strength in the labor market as employers compete for a limited supply of workers.

The number of available positions rose to 11.2 million in the month — topping all estimates — from a revised 11 million in June, according to the Labor Department’s Job Openings and Labor Turnover Survey, or JOLTS.

All eyes are now on the August non-farm payrolls Friday figures.

US consumers were happier about the state of the economy in August, according to a closely watched survey released today, as worries about rising prices eased.

After three months of decline, the consumer confidence index rose nearly eight points to 103.2 in August, from 95.3 in July, the conference board said.

Market Fed. so focused on

Jeff Buchbinder, chief equity strategist at LPL Financial, said, “Markets are so focused on the Fed that the jobs numbers are very strong on Friday, which may scare some people. We really need Goldilocks.”

“The stock could go a little higher between now and the end of the year, but we would expect quite a bit of choppiness in the near term as the market gathers more information on the Fed and interest rates outlook.”

All S&P 500 sectors were trading in the red. The yield on the 10-year Treasury rose to 3.13% from 3.11% late Monday.

Rate-sensitive megacap growth and technology stocks such as Microsoft Corp., Apple Inc. and Nvidia Corp. fell between 0.6% and 1.1%.

The CBOE Volatility Index, also known as Wall Street’s fear gauge, rose for the third consecutive session and was last trading at 26.41 points.

Raising concerns, Taiwan’s military fired warning shots at a Chinese drone that was buzzing an island controlled by Taiwan near the Chinese coast.

Best Buy posted a 4.6% increase after reporting a lower-than-expected decline in quarterly comparable sales, as steep discounts largely helped offset a blow to electronics demand from inflation.

Twitter Inc dipped 1% as Tesla Inc chief Elon Musk sent an additional notice to end a $44 billion deal to acquire the social media company.

The decline issues to a 2.55-to-1 ratio on the NYSE and to a 1.90-to-1 ratio on the Nasdaq.

The S&P index recorded no new 52-week highs and 10 new lows, while the Nasdaq posted six new highs and 102 new lows.

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