The stock market bounced back Wednesday as a weaker-than-expected jobs report helped to calm worries of rising interest rates. Despite the brief reprieve, earnings reports continued to show cautious consumers.
Indexes came off opening lows at 10 a.m. ET. The Nasdaq composite was up 0.7%, the S&P 500 rose 0.3% and the Dow Jones Industrial Average edged up 0.1%.
All three remain below their 50-day moving averages after violating those lines Tuesday.
Major stocks such as Apple (AAPL), Microsoft (MSFT), Amazon.com (AMZN) and Alphabet (GOOGL) are below their 50-day lines in lackluster trading. Facebook parent Meta Platforms (META) has bucked the downward tide, jumping 5% into a test at its 50-day line.
Volume fell on the Nasdaq and was unchanged on the NYSE, compared with the same time on Tuesday.
Western intermediate crude oil fell 1.8% to $89.89 per barrel, on worries of weaker global demand. Oil prices have been rangebound since July.
The Energy Select Sector SPDR (XLE) is the stock market’s worst S&P sector performer today, down 1.2%.
The August ADP employment estimate reported 132,000 job gains, well below the Econoday forecast of 225,000. It was also much lower than July’s revised 268,000 increase, indicating some cooling in the tight job market.
The labor situation is one of the economic factors the Fed is watching to calibrate its monetary policy. A weaker employment situation could act as a break on rising interest rates.
The ADP release is a precursor to Friday’s monthly non-farm payrolls report, when economists are looking for 293,000 new jobs.
U.S. Stock Market Today Overview
Last Update: 10:14 AM ET 8/31/2022
The yield on the 10-year Treasury note ticked higher after the report, and is now trading at 3.13%.
Stock Market Battered By Cautious Earnings
HP (HPQ) stock sold off 3.6% in heavy volume, hitting the lowest low since October 2021.
Late Tuesday, the maker of personal computers and printers met profit views but missed sales estimates for its fiscal third quarter. HP’s guidance for the current quarter was much lower than expected.
CEO Enrique Lores said the company faces “near-term market headwinds,” including a 20% drop in consumer PC revenue.
More signs of weakening consumer demand showed up in Chewy‘s (CHWY) July-quarter report. The online pet-products seller slightly missed sales forecasts and cut its outlook for the current quarter, warning that pet owners are cutting back amid economic uncertainty.
The stock has slid 6% in heavy trading.
It was a much brighter outlook for Designer Brands (DBI).
Bed Bath & Beyond Rattled On Strategic Plans
Bed Bath & Beyond (BBBY) plummeted 23%, as the troubled retailer continued a wild ride. The company just announced a new strategic plan that includes closing about 150 stores, cutting 20% of its corporate and supply chain jobs, and reducing capital spending from $400 million to $250 million.
Executives also said the company had secured new financing, made management changes and planned to reshape its buybuyBaby business.
More importantly for investors, 12 million new shares may be offered in coming months..
CrowdStrike (CRWD) erased opening gains and was down 1.7%. The cybersecurity company beat profit and sales expectations amid strong activity. The stock is holding above its 200-day moving average as it tests resistance around 200.
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