Traders work on the floor of the New York Stock Exchange during morning trading on July 31, 2024.
Michael M. Santiago | Getty Images News | Getty Images
Stocks fell on Thursday after fresh data raised concerns about a possible recession, reversing momentum seen earlier in the week.
the Dow Jones Industrial Average It fell by 532 points, or 1.3%. Standard & Poor's 500 It decreased by 1.2%, while Nasdaq Composite It decreased by 1.8%. Russell 2000 IndexThe New York Stock Exchange's benchmark index of small-cap companies, which has recently risen, fell 2.8%.
Initial jobless claims rose to 249,000 last week, beating the Dow Jones forecast of 235,000 and the highest since August 2023. The ISM manufacturing index came in at 46.8%, above expectations and indicating an economic contraction.
The yield on the 10-year US Treasury note fell below 4% for the first time since February.
The weak data comes a day after the Federal Reserve left interest rates at their highest levels in two decades. Fed Chairman Jerome Powell gave some investors hope by suggesting that a September rate cut was on the cards.
“The economic data continues to roll in the direction of a slowdown, if not a recession, this morning,” said Chris Rupkey, chief economist at FWD Bonds. “The stock market doesn’t know whether to laugh or cry. While the Fed may cut rates three times this year and the 10-year yield is below 4.00%, the winds of recession are blowing strongly.”
Stocks that would suffer the most in a recession were among the biggest decliners, including J.P. Morgan Chasewhich lost 2%, and Boeing, which fell more than 5%.
Dow, one day
Stocks started the day higher, as Meta platforms Meta shares rose more than 5.5% on stronger-than-expected second-quarter results and upbeat guidance. But Meta was one of the few stocks to rise as the trading day went on. Even big tech stocks like Nvidia We feel the pain as the AI chip drops by 3%.
