Dow-Jones Today: Decline in Index Due to Strong Job Figures

The Dow Jones Industrial Average (DJIA), commonly referred to as the Dow Jones, is a stock market index that measures the performance of 30 large, publicly traded companies listed on stock exchanges in the United States. It was created by Charles Dow and Edward Jones in 1896 and has since become one of the most widely followed stock market indices in the world.

Main Points

• After expressing concerns about an increase in aggressive interest rates due to private parole data, the Dow Jones Industrial Average fell by 1.1% on Thursday.
• Treasury yields rose, leading to a decline in bank stocks such as Goldman Sachs and J.P. Morgan Chase.
• There was a decrease in oil futures, causing Sherwin's stock to decrease by 2.2%.

According to private sector parole data, it has been revealed that the labor market is strong, which caused the Dow Jones Industrial Average (DJIA) to drop by 1.1% or 366 points on Thursday, raising concerns that the Federal Reserve may accelerate its plans or increase rates further.

As per the payroll service firm ADP, private employers added 497,000 jobs in June, exceeding Wall Street's expectations. This led to a decline in shares, with the S&P 500 and Nasdaq falling by 0.9% and 0.8% respectively.

Home Depot (HD) brought down the Dow with a 2.9% decline. Consumer sentiment in the independent sector fell by 1.6% due to concerns that higher rates will eventually impact consumer spending.

After stock downgrades by bearish analysts, American Express (AXP) shares fell by 2.3%.

ExxonMobil (XOM) had previously issued a warning that after a decline in natural gas prices and margins, Chevron (CVX) fell by 2.2%, which could result in the company's second-quarter profits being half of the previous quarter. Exxon shares also dropped by 3.7%.

Concerns about rising interest rates helped push yields on 2-year and 10-year Treasury bonds to their highest levels since March, triggering selling in bank shares. Goldman Sachs (GS) shares fell by 2.2%, while J.P. Morgan Chase (JPM) saw a 1% decline in its shares.

UnitedHealth Group (UNH) experienced a 0.3% decrease in its shares, as analysts from Jefferies expressed confidence in the proposed acquisition of home healthcare company AMEDISYS (AMED) after which it became one of the top performers for Dow.

Only two components of the Dow 30 remained in positive territory. Microsoft (MSFT) gained 1%, outperforming the broader tech sector, which was down by 0.3%. Morgan Stanley noted that Microsoft is among the companies best positioned to benefit from generative artificial intelligence (AI) and projected a 20% increase in the stock. Apple (AAPL) also saw an increase of approximately 0.3%.