Most Asian stocks slid on Thursday as investors weighed the economic impact of Trump’s second presidency , particularly his promise of increased tariffs . In response, the dollar climbed , adding over 1% on Wednesday. Major indices fell in China, Australia, and South Korea , while Japan showed mixed results. This followed a record surge in the S&P 500, which climbed 2.5% on Wednesday, marking its best post-election day ever, with the Nasdaq 100 up by 2.7% . Many expect the Federal Reserve (Fed) to cut interest rates today, a move closely watched by global markets. US stock gains largely reflect expectations of Trump’s pro-business agenda , centered on tax cuts and lighter regulations , which could potentially bolster corporate profits. However, Treasury yields jumped 16 basis points as Trump’s fiscal and tariff plans are predicted to fuel inflation, complicating the Fed’s efforts to reduce borrowing costs. In China, the CSI 300 Index fell by 1% , marking its second consecutive d
The Labor Department reported on Thursday that initial claims for state unemployment benefits dropped by 15,000 to a seasonally adjusted 227,000 for the week ending Oct 19, below economists' forecast of 242,000. Unadjusted claims declined by 22,634, with notable decreases in states like Georgia, New York, and Texas.
The report attributed the recent decline in new claims partly to Hurricane Helene, which had temporarily driven claims higher earlier in the month. However, the full impact of Hurricane Milton on the labor market is yet to be reflected in the data.
Despite these distortions, economists believe the labor market is softening, though not collapsing. Carl Weinberg, chief economist at High Frequency Economics, noted that Federal Reserve policy aims to support the economy and labor market, with gradual rate cuts potentially helping avoid a recession.
The number of continuing claims, a proxy for hiring activity, rose by 28,000 to a seasonally adjusted 1.897 million for the week ending Oct 12, marking the highest level since November 2021. This increase coincides with the survey period for the October unemployment rate, which will be released just before the Nov 5 presidential election.
The US jobless rate dropped to 4.1% in September from 4.2% in August, following a significant rise earlier this year that triggered the Federal Reserve's first major 50-basis-point rate cut in 2023. The Fed is expected to cut rates by 25 basis points again next month as it continues to manage inflation and economic uncertainty.
Comments
Post a Comment