Wall Street fears the economy will slow down too much and end down

The New York Stock Exchange, which had started in the green encouraged by good news on the fall in the cost of employment in the United States, finally ended down on Wednesday, fearing that the economy was slowing down too much.

The Dow Jones index lost 0.19% to 36,054.43 points, the technology-dominated Nasdaq lost 0.58% to 14,146.71 points and the broader S&P 500 index lost 0.39% to 4,549. .34 points.

Lower employment costs, better productivity in the 3rd quarter and a slowing labor market, these data synonymous with lower risk of inflation initially brought the New York Stock Exchange into positive territory in the first part of the session .

But the trend has reversed in the wake of a sharp drop in oil prices, while the market fears a deterioration in the economy and demand.

The price of a barrel of West Texas Intermediate (WTI), the American benchmark variety, closed on Wednesday below $70, a first in five months.

Energy sector stocks followed, falling 1.64%, which weighed down the Dow Jones and the S&P 500.

ExxonMobil lost 1.26%, Conocophillips lost 2.25%.

“There is growing concern that we may experience a hard landing in the economy this quarter or early in the year, and that is reflected in oil prices,” said Hugh Johnson of Hugh Johnson Economics. .

The technology sector was another red lantern in the S&P, losing 0.93%.

“Perhaps reality is starting to set in with the idea that the economy is slowing down, perhaps too much, which could lead to problems in the service sector,” Peter Cardillo told AFP. from Spartan Capital.

Investors are also on guard while awaiting official employment figures on Friday. Analysts forecast 175,000 hires in November, according to Briefing.com, compared to 150,000 the month before, with an unemployment rate stable at 3.9%.

The monthly ADP/Stanford Lab survey gave a foretaste of the evolution of employment in the private sector. Some 103,000 jobs were created, much less than expected by analysts (127,000).

In addition, the increase in wages in the private sector was the slowest in two years (+5.6% at an annual rate).

In addition to these data, which are in line with the fight of the American central bank (Fed) against inflation, there is a sharp upward revision of productivity in the third quarter (+5.2%) accompanied by a clear drop of the unit cost of employment, which fell by 1.2%.

These two figures “are moving in the right direction with regard to the objectives of the Federal Reserve, which means that rates should continue to move in the right direction for the market”, commented Patrick O’Hare.

Bond yields continued to slide, to 4.12% compared to 4.16% the day before, a three-month low.

On the value side, the online commerce platform Shopify lost 4.79% to $71.14 after an information day with investors, with some judging that the stock has risen very strongly since the start of the year.

The Citigroup banking group posted an increase of 2.48%. Its financial director indicated that the reorganization of the group, which will cost a billion dollars, will be effective at the end of the first quarter of next year.

Semiconductor manufacturer stocks took on water. Nvidia lost 2.28%, Intel lost 1.55% and AMD lost 1.32% after announcing the marketing of a new processor usable for artificial intelligence applications.

The online brokerage platform Robinhood soared by 7% while cryptoassets are on the rise, particularly bitcoin which during the day passed the threshold of 44,000 dollars, a new high since April 2022.