Chibuike Ogu
NEW YORK (Reuters) – U.S. stocks ended modestly higher on Tuesday after softer-than-expected labor market data confirmed expectations of an interest rate cut by the Federal Reserve.
Data on Tuesday showed U.S. job openings fell to their lowest level in more than three years in April, signaling an easing of labor market tensions that supported the Federal Reserve’s rate cuts this year. US Treasury yields fell after the report.
Wall Street’s major indexes rose after erasing earlier losses. Stocks in the real estate and consumer staples sectors rose the fastest, while materials and energy stocks were the biggest losers.
The labor market data was the latest in a string of recent reports pointing to a slowdown in US economic growth. Data on Monday showed U.S. manufacturing activity slowed in May for the second month in a row.
“What we’ve seen in the data this week is that it’s been relatively weak, starting with the manufacturing PMI and today’s job openings,” said James St. Aubyn, chief investment officer at Sierra Mutual Funds in Santa Monica. California.
“This has generally helped the rally in the bond market; but it’s a double-edged sword for the stock market because they’re waiting for a rate cut announcement, which is more likely with weaker data,” St. Louis said. ., added Aubin.
Market expectations for a rate cut in September are now around 65%, up from less than 50% last week, according to FedWatch CME tool. On Friday, closely watched nonfarm payrolls data for May will be released.
They rose 140.26 points, or 0.36%, to 38,711.29, added 7.94 points, or 0.15%, to 5,291.34 and added 28.38 points, or 0.17%. up to 16,857.05.
Megacap tech stocks, including Amazon.com (NASDAQ:), Alphabet (NASDAQ:), Nvidia (NASDAQ:) and Microsoft (NASDAQ:), closed higher after falling earlier in the session.
Oil giants Exxon Mobil (New York Stock Exchange:) and Chevron (NYSE:) fell 1.6% and 0.8%, respectively, as demand concerns weighed on oil prices.
Bath & Body Works (NYSE:) shares fell 12.8% after lowering its quarterly earnings forecast. Shares of Axos Financial (NYSE:) fell after Hindenburg Research disclosed a short position in the lender.
Shares of Paramount Global fell 4.4% after the media conglomerate said it was exploring strategic options or a joint venture for its Paramount+ streaming service.
On the NYSE, decliners outnumbered advancers by a 1.32-to-1 ratio. On the Nasdaq, 1,468 rose and 2,762 fell as decliners outnumbered advancers by a 1.88-to-1 ratio.
The S&P 500 posted 19 new 52-week highs and 6 new lows, while the Nasdaq Composite posted 40 new highs and 134 new lows.
Total volume of shares traded on U.S. exchanges was about 10.6 billion, compared with an average of 12.6 billion over the last 20 trading days.