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Headlines
- Major U.S. indexes fall, with chip and large tech stocks under pressure.
- Broadcom's Q4 revenue guidance and weak labor market reports impact market performance.
- Federal Reserve comments hint at potential rate adjustments, offering some market support.
Today, U.S. technology stocks are facing a downturn, with the S&P 500 down by 1.24%, the Dow Jones down by 0.59%, and the Nasdaq 100 falling by 2.20%. The declines are led by the tech sector, with significant pressure from chip stocks. Broadcom's stock dropped 9% after revealing lower-than-expected Q4 revenue projections, contributing to the broader market decline. Additionally, large-cap technology companies are experiencing significant losses, further weighing on the market.
Economic reports show that the U.S. labor market added 142,000 jobs in August, lower than the anticipated 165,000, while July's numbers were also revised downward. The unemployment rate for August decreased slightly to 4.2%, aligning with predictions. Average hourly earnings saw an increase of 0.4% month-over-month and 3.8% year-over-year, slightly surpassing expectations.
Despite the market's overall weakness, comments from New York Fed President Williams provided some support. Williams indicated that inflation is moving toward the 2% target, suggesting that reducing the federal funds rate could be a consideration. The market is currently factoring in a 100% chance of a 25 basis point rate cut at the upcoming Federal Reserve meeting, with a 31% probability of a 50 basis point cut.
