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U.S. Treasuries resumed their rally on Tuesday as the number of job openings fell to their lowest level since March 2021, further reinforcing hopes for a rate cut and a soft landing.
Meanwhile, Wall Street’s major averages were mixed after ending lower. In previous trading, investors continued to take a break after five consecutive weeks of gains.
The Nasdaq Composite Index, which has a high proportion of high-tech stocks (COMP.IND) Advanced 0.18% The price rose to 14,210.97 points in intraday trading, partly due to gains from the majority of “Magnificent 7” club members. The benchmark S&P500 (SP500) is 0.12% drop Blue-chip stock Dow (DJI) 0.38% decrease Up to 36,067.47 points.
Of S&P’s 11 sectors, eight were in the red, led by materials and utilities. Three growth sector companies rose.
Shortly after the opening bell, the U.S. Bureau of Labor Statistics’ latest Job Openings and Turnover Survey (JOLTS) showed the economy added 8.733 million jobs in October, compared to September’s revised figure of 9.35 million. This was moderate and below consensus expectations. 9.4M. The turnover rate remained at 2.3% for the fourth consecutive month.
A decline in headline numbers would no doubt be seen as a positive by the Federal Reserve, especially after the good data on inflation we’ve seen recently.
“The number of U.S. job openings in October was 8.7 million, well below market expectations and the lowest level since March 2021. Today’s statistics release, along with other signs of a softening U.S. economy, “This will highlight the tug-of-war between the US and the Fed’s current forward guidance on interest rates and what the market is pricing in,” said Mohamed El-Erian, chief economic advisor at Allianz, on X (formerly Twitter). mentioned in.
Treasury yields fell sharply across the board as expectations for a soft landing continued to draw traders into bonds. The long-term 30-year bond yield (US30Y) fell 12 basis points to 4.32%, and the 10-year bond yield (US10Y) fell 11 basis points to 4.18%. The interest rate-sensitive short-term two-year bond yield (US2Y) fell by 6 basis points to 4.60%.
See live data on how Treasury yields are moving across the curve on the Seeking Alpha Fixed Income page.
The economic calendar also included the Institute for Supply Management’s monthly survey of the services sector, which showed an expansion in economic activity in November.
Despite the JOLTS report, stock prices were weak on Tuesday. This is likely due to market participants remaining unsettled by the phenomenal rally, fueled by the broad consensus that the Fed is done raising rates and that a soft landing is possible.
“The market has lost some of its recent calm over the past 24 hours… There were no concrete triggers for softening, but November’s surprising rally and long-term positioning have led to some skepticism about how far the market can stretch. After all, although the market had fully priced in the Fed’s rate cut by the May meeting, just five months later, this is not the first time that expectations of a rate cut have increased this year. ,” said Jim Reid of Deutsche Bank.
Turning to active stocks on Tuesday, CVS Health (CVS) climbed the S&P 500 (SP500) after the healthcare conglomerate’s 2024 earnings outlook beat expectations and announced a new drug pricing methodology. ranked among the highest in terms of increase.
All eyes have been on Take-Two Interactive Software (TTWO) stock.Video game publisher unit Rockstar Games has released a trailer for the highly anticipated title Grand Theft Auto VI late Monday following a leak on X (formerly Twitter). The trailer has generated a lot of buzz, racking up around 76 million views in the past 17 hours, but investors seem disappointed with the longer-than-expected release schedule.