A downward start for Wall Street, with negative changes for the Dow Jones (-1.1%), the S&P500 (-1.1%) and the Nasdaq (-1.4%), after some macro data which confirm the solidity of the job market.
December’s ADP report on the private sector highlighted the creation of 235,000 jobs, above the estimated 150,000. The data, driven by small and medium-sized enterprises, highlights the resilience of labor demand, which is supporting wage growth, countering the Fed’s efforts to contain inflation.
In addition, in the week ended Dec. 31, the number of American workers filing for first-time jobless benefits fell 19,000 to 204,000, from 223,000 a week earlier (revised from 225 thousand initially detected). The consensus of the analysts consulted by Bloomberg expressed an estimate of 225,000 units.
Data which overall confirm the thesis of a still restrictive Fed to cool the economy and bring prices under control.
All while waiting for the non farm payrolls to be released tomorrow, which should show a number of new payrolls decreasing to 200,000 units and a stable unemployment rate at 3.7%.
Yesterday, the three indexes closed modestly higher, after the release of the minutes of the Fed. The minutes of the last meeting, held on December 13 and 14, showed that officials agree on the need to further increase the cost of borrowing, but gradually and flexibly so as not to unduly compromise economic growth.
FOMC members ruled out rate cuts in 2023, despite market expectations to do so, and warned markets against excessive optimism about an end to monetary tightening, as it could hamper its strategy to contain inflation.
Among individual Wall Street stocks, focus on Amazon (-0.9%) after the announcement of job cuts of up to 18,000 employees. Tesla falls (-4%), which recorded a drop in deliveries from the Shanghai factory after a record November, due to the temporary suspension of production and lower consumer demand.