Yahoo Finance Stock Market News for June 10, 2024
Wall Street closed lower on Friday, dragged down by the utilities and real estate sectors. While a jobs report showed that the labor market was resilient, investor mood was apprehensive about further delay in rate cuts. All of the three major stock indexes ended in the red.
How Did the Benchmarks Perform?
The Dow Jones Industrial Average (DJI) fell 87.18 points, or 0.2%, to close at 38,798.99. Fifteen components of the 30-stock index ended in positive territory, while the other fifteen ended in negative.
The tech-heavy Nasdaq Composite lost 39.99 points, or 0.2%, to close at 17,133.13.
The S&P 500 declined 5.97 points, or 0.1%, to close at 5,346.99. Seven of the 11 broad sectors of the benchmark index closed in the red. The Utilities Select Sector SPDR (XLU), the Materials Select Sector SPDR (XLB) and the Real Estate Select Sector SPDR (XLRE) lost 1.1%, 1% and 0.8%, respectively, while the Financials Select Sector SPDR (XLF) gained 0.4%.
The fear-gauge CBOE Volatility Index (VIX) decreased 2.9% to 12.22. A total of 10.8 billion shares were traded on Friday, lower than the last 20-session average of 12.7 billion. Decliners outnumbered advancers by a 2.72-to-1 ratio on the NYSE. On the Nasdaq, declining issues outnumbered advancing ones by a 2.60-to-1 ratio.
Strong Labor Market Numbers Spook Investors
The unexpectedly strong nonfarm payrolls report released on Friday suggested that while the labor market has softened around the edges recently, it is still fundamentally strong and might continue to deter the Fed from cutting rates anytime soon. The wages going up above expectations also indicated that elevated inflation may linger for longer.
The Labor Department said on Friday that nonfarm payrolls increased 272,000 in May, and the unemployment rate changed little at 4%. The number for April was revised down to 165,000 from the previously reported 175,000. The unemployment rate in April was at 3.9%.
Average hourly earnings for May increased 0.4% from the April number, which was unrevised at 0.2%. The average workweek remained static at 34.3.
After the release of the report, per CME’s FedWatch tool, traders now grant a 56% probability that the central bank would opt for a September rate cut. While investors will continue to eye inflation numbers releasing next week and the Fed’s June meeting, which ends on Jun 12, the stock market, in general, felt the pressure of rate cuts getting delayed on Friday.
Real estate and utilities suffered the most. Consequently, shares of Kennedy-Wilson Holdings, Inc. KW and DTE Energy Company DTE slid 2.3% and 1.1%, respectively. Kennedy-Wilson currently carries a Zacks Rank #1 (Strong Buy). You can see the complete list of today's Zacks #1 Rank stocks here.
Economic Data
Per a Fed report, consumer credit for April increased by $6.4 billion, as opposed to a consensus of $10.2 billion for the period. The number for March was revised down to a decrease of $1.1 billion from the previously reported increase of $6.3 billion.
Per a government report, wholesale inventories moved up 0.1% in April from the revised 0.5% fall in March.
Weekly Summary
The three most widely followed indexes closed a winning week last Friday. The Nasdaq Composite, the S&P 500 and the Dow Jones Industrial Average advanced 2.4%, 1.3% and 0.3%, respectively.
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