Technology stocks continue to weigh on stocks with the S&P 500 slipping 0.2% and the Nasdaq down 0.3% on Wednesday. Six sectors outperformed the S&P 500 yesterday with Consumer Staples (XLP) and Utilities (XLU) performing the best.
The latest job openings data from the Bureau of Labor Statistics came in less than expected; another sign that demand for labor continues to cool. Additionally, the Fed Beige Book reported that “Employers were more selective with their hires and less likely to expand their workforces, citing concerns about demand and an uncertain economic outlook.”
Fed Chair Powell said back in August, “We do not seek or welcome further cooling in labor market conditions.” Fed San Francisco President Mary Daly said yesterday that the labor market health has to be “sustained and protected, and we have to be very mindful that if policy is overly tight, you might get additional slowing in the labor market, and to my mind, that would be unwelcome.”
Some economists think the latest data could push the Fed to be more aggressive in their rate cuts. The Fed has held policy rates in the 5.25%-5.50% range for over a year.
After a Bloomberg report Tuesday, Nvidia (NVDA) says they contacted the DOJ and was told their company has not been subpoenaed. The company released a statement, “Nvidia wins on merit, as reflected in our benchmark results and value to customers, and customers can choose whatever solution is best for them.”
Gasoline prices are coming down and are near a six-month low at a national average of $3.32 per gallon. According to AAA, gas prices are down $0.15 since last month and $0.49 since last year. US summer driving demand dropped from last year and it has been a quiet hurricane season so far which has oil prices collapsing. Much of the US will be switching to winter-grade gasoline soon which will add more downward pressure to prices. Some analysts expect gasoline prices to be below $3.00 by the end of 2024.
Corporate earnings after the bell include Broadcom (AVGO), DocuSign (DOCU), GWRE, and IOT.
The economic calendar includes ADP @ 8:15am ET, Claims, Nonfarm Productivity & Unit Labor Costs @ 8:30am ET, S&P Global Services PMI @ 9:45am ET, ISM Services PMI @ 10:00am ET, and Oil @ 11:0am ET.
Volatility remains relatively high with the ES 5-day average daily range near 92 points.
Whale bias is bullish into the 8:15am ET ADP report on decent overnight large trader volume.
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