Shares traded lower on Monday as investors raised bets that the Federal Reserve would withdraw its stimulus measures following a stronger-than-expected US jobs report.
Oil prices fell and gold prices stabilized after a “lightning crash” on Monday night that briefly brought bullion prices to a four-month low.
The Dow Jones Industrial Average fell 119 points, or 0.34%, to 35,089, the S&P 500 slipped 0.02% and the Nasdaq slipped 0.02%.
The yield on the benchmark 10-year Treasury index was down slightly on Monday to 1.282%.
The Dow Jones and S&P 500 closed at record highs on Friday following a jobs report for July which pointed to a recovery in the labor market but also boosted expectations that the US central bank may soon begin to reduce its extraordinary stimulus which supported the gains of the stock market. The S&P 500 on Friday set its 44th record at the close of 2021 and ended the week with a gain of 0.9%.
The non-farm wage report released on Friday showed that 943,000 net new jobs were created last month, while average hourly wages rose 4% from last year to just over 30, $ 50. The data triggered bets that the Federal Reserve would begin to slow the pace of its $ 120 billion monthly bond purchases while raising interest rates.
Dallas Federal Reserve Chairman Robert Kaplan told Bloomberg in an interview that the Fed should start phasing out asset purchases as soon as possible.
âI would support the adjustment of these purchases soon, but once we start the adjustment process, I would probably prefer it to be more gradual,â Kaplan told Bloomberg last week before the release of the report. ‘use.
The prices of commodities, such as oil, have plummeted over fears that restrictions put in place to curb the spread of the COVID-19 virus variant will dampen demand. West Texas Intermediate crude oil, the US benchmark, fell 2.78% to $ 66.38 per barrel.
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Investors will also follow the progress of the $ 1,000 billion Senate infrastructure bill that would fund public works programs such as roads, bridges, railways, waterways, ports and expansion. broadband internet. The bill looked set for passage in the upper house at the start of this week before moving on to a more severe challenge in the House of Representatives.