Volatility returns to stock trading and crude oil drops to a level not seen since a year ago. Bond yields dropped in the U.S., Europe and Asia as central banks around the world moderate or pause rate hikes.
Stocks were on the defensive on the worries that the U.S. economy may be too hot and the Federal Reserve may have to continue with its aggressive rate hike campaign.
European markets extended losses after rate anxieties and domestic demand worries resurfaced. Oil tankers carrying Russian crude face additional delays after Turkey imposed EU sanctions.
AutoZone earnings dropped on higher costs and inventories rose. BuzzFeed plans to cut 12% of its workforce Signet Jewelers revised its adjusted operating margin outlook.
Major averages extended this week's losses and investors worried that the hotter-than-expected economic activities and tight labor market conditions may force the Federal Reserve to continue its aggressive rate hike campaign.
Rate-path worries resurfaced after the release of stronger-than-expected data on new orders and inventories and service sector growth. Natural gas prices plunged 10% on the expectations of milder weather over the next two weeks.
Unfilled orders increased for the 26th month in a row in October and new orders for goods increased in twelve of the last thirteen months. Service sector rebounded in November. China stocks jumped on the hopes of a pick up in business activities.
What is good for the U.S. economy was not good for stocks on Wall Street. Despite the strength in the labor market, labor participation rate remains below the pre-pandemic level. The U.S. dollar fell for the second week.
Investors are looking ahead to non-farm payroll on Friday after a narrow measure of inflation moderated in October and retail gasoline prices wiped off the price increase in the last nine months.
Dollar General earnings fell on higher costs and unanticipated surge in temporary storage costs. PVH Corp advanced on sales outlook. Snowflake fourth quarter sales guidance disappointed. Five Below earnings lagged sales growth.
Indexes pared back some of the large gains in the previous session. The Federal Reserve's preferred measure of inflation, which understates price increases, rose at the slowest pace this year in October
Investors reacted positively after Fed Chairman Powell said future rate hikes may be moderated but the terminal rate is likely to cross 4.6% and stay above longer than anticipated in September.
Stocks turned higher after Chairman Powell suggested a slower rate increase may be appropriate beginning as early as December. However, Powell cautioned rates are likely to go higher and stay higher for a longer period of time than previously anticipated.
Investors shift focus to upcoming economic data released this week and comments from the Fed chair Powell as earnings season winds down. European markets eased as inflation stays elevated. India indexes soar on strong domestic demand revival.
