Slowing Employment Growth – Stimulus Fears Weigh on the Nasdaq 100

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The Nasdaq 100 closed much lower on Friday with the data showing a steep slowdown in the US job growth and traders worried that policymakers won’t agree on a new fiscal stimulus package to boost the economy from COVID-19 induced recession.

On the other hand, the Dow Jones and the S&P 500 index flat to a new high on the day.

With the S&P 500 index benchmark currently trading at 1.5% below the record high, defensive sectors including real estate and utilities were some of the top gainers. Also, the tech-related stocks that have driven Wall Street from March, posted the highest declines and assisted nudge the Nasdaq 100 over 1% during this session.

On the same issue, value names that haven’t been able to close this performance gap with growth stocks over the years, advanced with the Financials gaining over 2%. On the other hand, the S&P 500 growth index and the S&P 500 value index plunged 0.63%.

Nevertheless, the numbers still topped the analysts and economics expectations stated that it was going to take pressure from congress so that they can finally agree on a feasible relief bill after weeks of disputes. Also, differences have partly been centered on continuing an additional $600 per week in jobless benefits.

On Friday, the democrats in congress proposed to reduce the recommended COVID-19 stimulus package by $1 trillion incase the republicans will consider adding a trillion to their initial offer. Nevertheless, white house negotiators rejected this idea yesterday as the final round of talks came to an end without any substantial deal.

Also, the U.S. The Senate Democratic leader called a meeting with the republicans whose results were disappointing and the house speaker went ahead to state that any agreement with the aid seems unlikely, with extensively unresolved differences.

The reality is that jobless is through the roof with regards to historical averages, there is no doubt that we are still in COVID-19 pandemic without any cure and the republicans have already promised an additional $1 trillion or more for the American people.

Technically, it would be a political suicide incase the republicans don’t do this.

It is also important to take note of the fact that the Nasdaq 100 plunged by 0.87%, S&P 500 gained 0.06% and the Dow Jones Industrial Average gained 0.17%.

The fall snapped the Nasdaq composite 7-session array of gains with the S&P 500 and Dow Jones falling after surging for 5 straight days. All these three indices posted amazing weekly gains.

With the 2nd quarter corporate earnings over approximately 82% of about S&P 500 firms that have so far reported to have surpassed the lower estimates with the monthly earnings coming in at 2.5% beyond expectations.

Uber dropped 5.21% as the demand for the ride-hailing trips slightly recovered from COVID-19 worst run in the 2nd quarter as Crude Oil Drops Under $45/bbl. On-Demand Issues, But Posts Weekly Surge.

This is happening as president trump imposes a ban on the U.S. Transactions with the Chinese parent company of the messaging app TikTok and WeChat.

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