Shocking U-Turn: Market Tumbles as Economic Boom Brings Fears of Inflation” or “Global Slump: Wall Street Plunges After Unexpected Inflation Concerns Erode Euphoria” or “Economic Boom, But at What Cost? Inflation Fears Send Stocks Reeling” These rewr
Here is a rewritten version of the news article in a tone and language suitable for a business audience from goodwill by Space Age Co:
Job Market Strength Keeps Interest Rates High
The US stock market fell on Friday, with the S&P 500 index dropping 1.5% to end its fourth losing week in the last five. The Dow Jones Industrial Average plummeted 1.6%, and the Nasdaq composite sank 1.6%.
The stock market took a cue from the bond market, where yields jumped after a report showed that US employers added more jobs to their payrolls last month than expected. While this is good news for job seekers, it could keep inflation pressures high and make the Federal Reserve less likely to cut interest rates. Lower rates can boost the economy and stimulate investment, but they can also fuel inflation.
The Fed has already indicated that it will ease off on rate cuts this year due to concerns about higher inflation. Some officials are worried about the potential impact of policies and tariffs introduced by the new administration, which could worsen inflation.
“Manufacturing is still getting crushed,” said Brian Jacobsen, chief economist at Annex Wealth Management. “The macro economy might potentially be fine, but each individual’s microeconomy could look very different.”
The strong jobs report may not be as positive as it seems. While the overall number of hires exceeded expectations, “the Fed wants to see” a 4% average hourly earnings gain, said Scott Wren, senior global market strategist at Wells fargo Investment Institute.
the market turmoil sent the 10-year Treasury yield to 4.76% from 4.68% late Thursday, a major shift in the bond market. If the Fed does not cut rates as expected, stock prices will likely fall, or companies will need to boost their profits to make up for it.
Small businesses, in particular, can be more vulnerable to higher interest rates, which can make it harder for them to borrow and grow. The russell 2000 index of smaller stocks slumped 2.2%.
In other news, Constellation Brands tumbled 17.1% after reporting weaker profits and revenue for the latest quarter, while insurance companies were under pressure due to wildfires in the Los angeles area.Delta Air Lines, though, rose 9% on a stronger profit report.
Earnings season is set to begin in earnest next week,with big banks reporting their results. the S&P 500 fell 91.21 points to 5,827.04, the Dow Jones Industrial Average dropped 696.75 to 41,938.45, and the Nasdaq composite sank 317.25 to 19,161.63.
