Wall Street was mixed, despite being better than expected. December’s U.S. private employee reports
Let’s kick off today’s session with December’s U.S. private employee reports. U.S. private employers added more roles than expected in December, indicating resilience in the labor market. The report added that payrolls increased to 164,000, up from a revised 101,000 in November, surpassing economists’ predictions of 115,000. Which supports market resilience and empowers the Fed’s position against taming inflation. They were speaking about the Fed’s aggressive monetary policy. The robust labor market performance may influence Federal Reserve policymakers to reconsider potential interest rate reductions in 2024. Still, despite that growth in private payrolls, pay growth eased to 5.4% from 5.6% in November, contributing to a broader deceleration since September 2022. With this report, Wall Street boosted, while investors turned their attention to the upcoming December nonfarm payrolls report. The report is set to be used on Friday. As for its market cruciality, nonfarm payroll is crucial and could impact risk sentiment in the near term.
In individual corporate news, Nvidia stocks have been falling steadily since the start of this year. The company stock prices fell by 2.7% on the first trading day of 2024 and are down an additional 1.1% in pre-market trading on Wednesday. From an analysis perspective, Nvidia is a leader in accelerated computing with a projected 20% compound annual growth rate (CAGR) from 2022 levels. On top of that, analysts cite vulnerability for NVDA as the hype around artificial intelligence (AI) approaches the “trough of disillusionment.” However, in the world of artificial intelligence, some experts see that 2024 will be less exciting compared to the previous year. AI remains a subject of interest in the technology sector for its promising potential and impact on the global economy. However, analysis shows that 2024 will be less thrilling in this sector.
Meanwhile, on Wall Street, the top main indexes were mixed, showing mixed signs. The S&P 500 benchmark added 0.1% to collect a total of 4,710.2 basis points. The tech-heavy composite Nasdaq was down by 0.11%, and the down was up by 0.29%.
In other economic nations, the bond market has surged amid fears of Federal Reserve monetary policy uncertainty. At the same time, oil prices edged lower, which confused the market in terms of oil supply and demand.
The 10-year Treasury yields rose by 2.5% to 4.003%, while the fixed mortgage rates rose by 2.9% to 4.100%. The decline in Nivida stocks and Nasadq finance confirms that the country is still vulnerable to global political tensions, which include the two wars and the untitled tensions with China and OPEC members. On top of that, Fed officials remain cautious about dealing with inflation, and the probability of more than two interest rate hikes this year is high.
Moving to the oil market, A bigger-than-expected decline in crude inventories was masked by significant weekly rises in gasoline and distillate stocks, causing oil prices to fall 2% and erase an earlier gain. U.S. WTI crude futures fell to $72.09 and Brent crude to $77.656 per barrel as a result of substantial inventory increases disclosed by the U.S. Energy Information Administration and poor fuel demand. Fuel stocks increased at the fastest rate in more than 30 years every week, while distillate stocks increased as well, with distillate product demand falling to its lowest point since 1999.