Stocks wavered Wednesday and rates slid as investors digested key jobs and manufacturing data ahead of the Federal Reserve’s meeting minutes release.
The Dow Jones Industrial Average rose 87 points, or 0.25%, reversing earlier losses but off highs of the day. The S&P 500 and the Nasdaq Composite also recouped losses to trade up 0.63% and 0.52%, respectively.
The November Job Openings and Labor Turnover report, or JOLTS, came in slightly better than anticipated, signaling continued labor market strength amid the central bank’s rate hikes to tame inflation. The ISM manufacturing index, on the flip side, showed a contraction in the sector after 30 months of expansion, signaling that interest rate increases may be working to slow the economy.
Still, investors struggled to find a clear direction ahead of more economic data to come, including Fed meeting minutes due later Wednesday and the December jobs report Friday.
“This is very much wait and see mode,” said Art Hogan, chief market strategist at B. Riley Financial. “After wrapping up a year that was pretty terrible on all fronts, there’s always going to be trepidation by investors to put money to work and we’re seeing that in real time at least in the first two trading days.”
U.S. stocks started 2023 on a downbeat note Tuesday as rising rate concerns, high inflation and recessionary fears crushed hopes that Wall Street could kick off the new year on a positive note. The S&P 500 and Nasdaq Composite lost 0.4% and 0.8%, respectively, while the Dow closed just below breakeven. The major indexes were also pressured by steep declines in Apple and Tesla shares.
“U.S. stocks were unable to hold onto earlier gains as restrictive policy and recession fears remained front and center for investors,” wrote Oanda’s senior market analyst Ed Moya in a note to clients Tuesday. “Discount buying triggered another bear market rebound that didn’t last long at all.”
