The US jobs report for June is better than expected. Nevertheless, concerns about further rate hikes persist on Wall Street. According to a media report, Elon Musk is dissatisfied with information from Twitter - the stock is slipping.
The US stock exchanges have walked a fine line between economic confidence and recession worries. The background was the US job market report for June, which was significantly better than expected. On the one hand, it showed no negative effects on the interest rate hikes that had already taken place and thus spoke for a strong economy, on the other hand, it fueled concerns about further aggressive interest rate hikes by the US Federal Reserve, which had previously spoken of an overheated labor market. However, sharply rising interest rates could not only slow down growth, but also lead to a recession, according to fears on the financial markets.
However, as trading progressed, the optimists gained the upper hand, betting that a soft landing will be possible in the end. "It gives the Fed a little more confidence that it can be more aggressive without seriously damaging the job market," commented Edward Jones investment expert Mona Mahajan, adding, "At some point it's going to hit the economy."
After losses in the opening trade, the indices turned upwards at midday and defended small gains at least until shortly before the end of trading. Confidence in the economy also had an impact on the oil market, with oil prices rising by around 2 percent.
The Dow Jones index fell slightly by 0.1 percent to 31,338 points. For the S
In the bond market, prices fell, so yields rose, consistent with the underpinning rate hike expectations. The 10-year yield rose 8 basis points to 3.08 percent. The yield curve thus remained inverted, signaling the risk of a recession.
While the unemployment rate remained unchanged at 3.6 percent despite significantly more jobs being created than expected, the increase in hourly wages was within the expected range at 5.1 percent compared to the previous year. Wage growth at this sustained high level keeps pressure on the central bank to tackle inflation, observers said.
All in all, the dollar showed little change, especially as interest rate expectations had not changed. The euro last cost 1.0180 dollars, in the daily low it was already available for 1.0072.
We are now eagerly awaiting the upcoming US inflation data next week. Consumer prices are expected to have risen 1.0 percent month-on-month in June, and 8.8 percent year-on-year. It would be the highest increase in the US since December 1981.
Twitter shares are down 4.8 percent. As the "Washington Post" reported, citing informed people, the team around Tesla boss Elon Musk, who was willing to take over the company, considers the information requested and provided by Twitter to be insufficient. The background is Musk's concerns that many user accounts on the platform could be fake, which could stand in the way of the takeover. Meanwhile, Twitter announced that it would be cutting jobs because of the slowdown in business and the possible upcoming takeover.
Gamestop fell 4.9 percent after the video games retailer also announced job cuts and the separation from its chief financial officer. The day before, the price had shot up by 15 percent with the news of a stock split. Levi Strauss gained 1.0 percent after the jeans maker beat expectations with second-quarter sales and profit.
