Wall Street, Dow Jones Opens Lower Despite Better Job Creation

Wall Street, Dow Jones Opens Lower Despite Better Job Creation

On Friday, the US stock market opened down despite the Federal administration creating more than expected jobs in the market in July. The better payroll failed to impress the US people and clear the concerns that the economy has halted.

The United States created around 1.763 million postings as compared to the experts’ 1.60M jobs prediction for the July month. The creation is still down from revised 4.791M positions created last month, which points out the loss of momentum in the employee-job market. Yet, it was a relief from the dramatically weak reports by ADP on private payrolls earlier this week.

On Friday, the Dow Jones IA (Industrial Average) was 0.3% or 73 points down, at 27,314 points. Apart from it, by 9:35 AM ET (or 01:35 PM GMT), the Nasdaq Composite plunged 0.2%, and the S & P 500 fell 0.3%, after closing at an all-time high, this weak.

No action leads to the failure of this job report to create an impact in favour of the extension of unemployment benefits for the hundreds of thousands of people who have lost their jobs due to the pandemic. Some other reasons could be the failure of consensus among lawmakers in Washington for another stimulus package for the economy and the US president, Trump’s, decision to widen the ban on “unprotected” Chinese apps.

Among the stock market losers were US-listed Tencent Holdings, which plunged 7%, Alibaba & Nio, both of which fell 4%, and Uber, whose share price slumped 5.1%.

The US-Sino tensions created intense friction between the two nations after Trump initiated a ban on Chinese apps WeChat, which is owned by Tencent, and ByteDance, which is the owner of TikTok. Further, other companies plunged in response to the announcement by the administration to force the Chinese firms to open their account books to auditors, otherwise forcing them to delist from the US.

Uber, on the other hand, fell, after it announced a substantial loss for the 2Q despite its food delivery business is on a booming run. However, the company’s core business model, i.e. car ride business, encountered a 75% fall in its gross bookings. Uber CEO, Dara Khosrowshahi, has set a break-even target for the company’s food business, Uber Eats, which is still running in loss, and the company’s growth is essential to Khosrowshahi’s growth chart in the company.

Meanwhile, the best performer in the US stock market was Zillow, which added 15% to its account, as the online real estate firm posted better than expected results and touched its five-year high mark on the exchange.

FAQs

Leave a Reply

Your email address will not be published. Required fields are marked *