U.S. Indexes Drop 1% After Strong Jobs Report

Barry Adams
06 May, 2022
New York City

U.S. market indexes turned lower at the opening and accelerated declines after 20 minutes of trading.  

The S&P 500 index fell 1.8% or 73.8 points and the Nasdaq Composite index dropped 2.4% or 289 points.

The U.S. stock decline on Thursday erased more than the gains in Wednesday's trading on the worries that the Fed's response to the latest bout of inflation is not going to be adequate and labor markets conditions remain tight. 

The latest jobs report from the U.S. Department of Labor indicated employment increased 428,000 in April and jobless rate was 3.6% matching the rate in March. 

UnderArmour plunged more than 19% after the apparel company reported adjusted profit of 1 cents below the estimated range between 3 and 6 cents. The company also issued a weaker-than-expected outlook. 

Zillow Group fell 15% after the real estate broker reported strong quarterly results but issued weak annual outlook. 

DoorDash Inc gained 2% after the delivery company reported better-than-expected quarterly results and the orders delivered rose 23% from a year ago to 402 million. 

Revenues rose 35% to $1.5 billion and gross marketplace volume increased 25% to $12.4 billion. 

In Europe, the DAX index and the CAC-40 index declined 1.2% and the FTSE index fell 1% after the Bank of England yesterday estimated that the elevated energy prices are pushing the U.K. economy to a sharp slowdown. 

In Asian markets, the Nikkei index edged up 0.7% but the indexes in Hong Kong declined 3.8% and in Shanghai dropped 2.2%. 

Markets in China were on the defensive after top Chinese leaders issued strongly worded public comments in support of the zero-Covid policy.  

 China's premier Xi Jinping and other top leaders reiterated strong support for zero-Covid policy and sent strongest warnings to anyone doubting the government's commitment to zero-Covid policy. 

Dozens of cities in China are going through severe restrictions or lockdowns. 

In a broad sell-off in Mumbai, banks led the losers and small and mid-cap indexes also dropped more than 1%. 

The rupee declined 57 cents to 76.92 against a dollar and crude oil edged up 2% in international trading to $113.46 a barrel.