FRIDAY – Stocks fell on Friday after the U.S. government released employment data that badly missed expectations, adding to growing concerns that the global economy may be slowing down.
The Dow Jones Industrial Average pulled back 215 points as Caterpillar and Chevron lagged. The S&P 500 fell 0.8 percent as the energy and tech sectors both dropped more than 1 percent. The Nasdaq Composite slid 1.1 percent.
The U.S. economy added just 20,000 jobs in last month, marking the weakest month of jobs creation since September 2017. Economists polled by Dow Jones expected a gain of 180,000.
Treasury yields fell along with futures. The benchmark 10-year rate dipped to 2.619 percent while the 2-year yield traded at 2.45 percent.
Equities were on track to post rare weekly losses. The major indexes were all down more than 1.9 percent entering Friday’s session. The Nasdaq was on pace to snap a 10-week winning streak, while the Dow was set to notch its second weekly decline of the year.
The weekly decline comes amid growing fears that most of the positive news on the U.S.-China trade front may be baked in. At this point, most investors expect the two countries to strike a trade deal later this month. There are also worries that a deal may not be sure thing.
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MONDAY – U.S. stock index futures rose on Monday on a report that U.S. and China are getting close to a trade deal.
This morning, the Dow Jones Industrial Average futures were up 65 points, indicating a gain of more than 70 points at the open. Futures on the S&P 500 and Nasdaq 100 were also slightly higher.
The Wall Street Journal reported that China had proposed to bring down duties on certain American goods in an attempt to strike a deal with the U.S. The same report suggested both countries are at the final stage of their negotiations, which could see the country’s leaders meeting at a special summit to sign a trade deal soon.
The Trump administration touted last week significant progress being made in U.S. negotiations with China. Treasury Secretary Steven Mnuchin told CNBC on Thursday the two sides were getting closer.
The back-and-forth on trade between the two countries has sent ripples through financial markets since last year, with investors fretting how tighter trade conditions could impact corporate profits.
On the economic front, there will be construction spending figures out at 10 a.m. ET.
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U.S. stock index futures pointed to a strong open on Friday, as Wall Street looked to build on its best start to a year in nearly 30 years.
At around 8:10 a.m. ET, Dow Jones Industrial Average futures indicated a gain of more than 170 points at the open. Futures on the S&P 500 and Nasdaq 100 were also up.
The major indexes posted solid monthly gains in February, pushing the S&P 500 to its best start to a year since 1991. The S&P 500 is up more than 11 percent for 2019, along with the Dow. The Nasdaq, meanwhile, is up 13.5 percent.
Decreasing trade tensions between China and the U.S., along with a declining fears of tighter monetary policy from the Federal Reserve, helped propel stocks higher.
Market participants are likely to closely monitor a fresh batch of economic data on Friday. Personal income, consumer spending and core PCE figures for December and January will be released at around 8:30 a.m. ET.
Manufacturing PMI, ISM manufacturing, and consumer sentiment data are all expected to follow later in the session.
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Record exports reduced the U.S. trade deficit in March, the first drop in seven months in a massive gap that President Trump has been determined to shrink with an aggressive America first policy.
The Commerce Department says the trade deficit slid to $49 billion, down from $57.7 billion in February and lowest since last September.
The President has vowed to bring down America’s massive deficits, which he blames on bad trade agreements and abusive practices by U.S. trading partners.
Exports rose in March to a record $208.5 billion, led by shipments of civilian aircraft and soybeans. Imports slipped 1.8 percent to $257.5 billion.
The United States ran a $20.5 billion surplus in the trade of services such as education and banking. But that was offset by a $69.5 billion deficit in the trade of goods.