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US markets fall after jobs figures feed rate worries

2025-01-11 HKT 07:09
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  • Wall Street finished lower, amid fears that strong jobs growth will feed inflationary pressures. File photo: Reuters
    Wall Street finished lower, amid fears that strong jobs growth will feed inflationary pressures. File photo: Reuters
US markets finished lower on Friday, after a strong employment report fuelled expectations the central bank might make fewer interest rate cuts this year.

The Dow Jones Industrial Average lost 1.6 percent to 41,938.45, and the S&P 500 Index fell 1.5 percent to 5,827.04.

The Nasdaq Composite Index retreated 1.6 percent to 19,161.63.

The slide across major indexes came after a Department of Labor report showed the world's biggest economy adding 256,000 jobs in December.

This defied expectations of a slowdown in job growth, while the unemployment rate ticked down to 4.1 percent as well.

Following the report, the yield on the 10-year Treasury note shot up, before moderating its gains.

Investors took the better-than-expected labour market figures "as a sign" that the Federal Reserve would be slower in reducing interest rates, said Sam Stovall of CFRA.

While the Fed has started cutting rates last year, after the Covid-19 pandemic, policymakers have been balancing this with progress in lowering inflation sustainably.

"January will continue to be a volatile month," Stovall said, citing interest rate worries and traders' focus on earnings reports.

According to the CME FedWatch tool, the market sees a 97 percent chance that the Fed holds rates steady at its next policy meeting.

Among individual companies, Apple shed 2.4 percent and Nvidia shares fell 3.0 percent. (AFP)

US markets fall after jobs figures feed rate worries