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U.S. stocks drop as weak data fuels recession fears

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Wall Street dropped amid concerns the Federal Reserve’s campaign to rein in decades-high inflation may cause a deep downturn

 
U.S. stocks dropped on Tuesday after economic data came in weaker than predicted. That raised worries that the Federal Reserve’s moves to rein in decades-high inflation may cause a deep downturn.

The Dow lost 6-tenths of one-percent. The S&P 500 fared about the same while the Nasdaq slipped half of one percent.

Job openings in February fell to their lowest level in nearly two years which raised concerns about the health of the economy, according to RiverFront Investment Group Chief Investment Officer Kevin Nicholson.

“The markets are being driven by the JOLTS report that came out this morning that showed that we were under 10 million jobs for the first time since May of 2021. And so that gave the market the impression that the, you know, the labor market was slowing and that the Fed would have to take that into consideration and probably not raise rates”

Also, factory orders fell more than anticipated, their second straight monthly decline.

Bank stocks took a hit after JPMorgan Chase CEO Jamie Dimon warned in a letter to shareholders that the U.S. banking crisis is ongoing and that its impact will be felt for years.

Other stocks making moves included Virgin Orbit Holdings, which sunk 23-percent after the satellite launch company filed for Chapter 11 bankruptcy after it failed to secure long-term funding.

Shares of AMC Entertainment also fell. Its stock plummeted 23-percent after the movie theatre chain said it agreed to settle litigation and proceed with converting its preferred stock into common shares. #trending #featured

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Federal Reserve lowers rates amid eased job market

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The Federal Reserve has cut interest rates by a quarter-point, bringing the benchmark rate to a range of 4.5% to 4.75%, as economic growth continues but job gains slow.

The Fed noted that labour market conditions have “generally eased,” even with low unemployment, signalling a more cautious approach amid a stable economic expansion.

The statement marks a shift in Fed language, now saying inflation has “made progress” toward the 2% goal instead of the prior “further progress.”

With inflation holding steady around 2.6%, policymakers aim to keep economic risks balanced, despite pressures from slower job growth.

This rate cut reflects a strategic move to sustain economic momentum while cautiously watching inflation’s gradual trend toward the Fed’s target.

The decision was unanimous, aligning Fed priorities with a balanced approach to support both employment and price stability.

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Trump victory sparks market surge as Wall Street soars

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Donald Trump’s election victory has sparked a massive rally in the stock market.

Banks and industrial companies led the surge as investors bet that Trump’s plans for deregulation and tax cuts will boost economic growth.

Shares of big banks, like JPMorgan and Goldman Sachs, soared as investors predicted fewer regulatory restrictions.

Meanwhile, industrial giants such as Caterpillar and steelmakers like Nucor also hit record highs, reflecting optimism about U.S. manufacturing.

In contrast, clean-energy stocks took a hit, as Trump’s policies are expected to favour traditional energy sectors.

This surge comes amid rising Treasury yields and falling gold prices as investors gain confidence in the transition to a Trump administration.

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Australian Treasurer and RBA chief clash over economy

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A rare dispute has emerged between Australia’s Treasurer Jim Chalmers and Reserve Bank Governor Michele Bullock over the nation’s economic trajectory.

Governor Bullock argues the economy remains overheated, even as growth data shows recent slowdowns.

Treasurer Chalmers, however, warns that sustained high interest rates are “smashing the economy.”

This debate is critical for Australians, as it will influence the future of interest rates and inflation.

Data shows a mixed economic picture: while inflation is down, it’s still above target, and the jobs market remains historically strong.

Ultimately, deciding who’s right may come down to theory and perspective on economic health.

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