4:15pm: Dow drops
US stocks were mixed at Thursday’s closing bell after a volatile session, with the Nasdaq inching 0.3% higher to close at 17,127 points.
The Dow Jones and S&P 500, on the other hand, booked another day of losses.
The Dow shed 0.5% at 40,755 points and the S&P 500 was down 0.3% at 5,503 points.
Applied Digital Corporation surged 65% on news it has raised $160 million in funding from Nvidia and other backers, while Chinese electric vehicle startup NIO booked a 14.4% gain on positive quarterly earnings.
3:00pm: Truth Social sinks
Shares of the parent company of Donald Trump’s social media platform Truth Social hit an all-time low on Wednesday after it went public earlier this year.
The company's Wednesday closing price marked an almost 80% drop from its high of $79.38 in March 2024.
Shares had recovered slightly by Thursday afternoon, trading hands at $17.24 in the early afternoon.
Republican presidential candidate Trump, who owns about a 60% stake in TMTG, has seen his share decline in value from about $6 billion to $2 billion since the company went public.
1:30pm: Nasdaq above water
The Nasdaq peeked its head above water in early afternoon trading after a volatile session in the markets Thursday.
The tech-stacked index fluctuated between gains and losses but was ahead around 0.1%, while the S&P 500 slipped as much as 0.6%.
Meanwhile, the Dow dropped more than 140 points, or about 0.4%.
11:40am: Smaller rate cut after ADP data
Comerica sees a quarter percent rate cut at the September 18 decision as "a bit likelier" than a half-percent cut, chief econonist Bill Adams commented, noting a larger cut "wouldn’t be a surprise at this point."
"ADP’s weak job gain suggests the soft July jobs report was due to the business cycle, and not just the impact of Hurricane Beryl," Adams wrote.
"Following ADP’s release of weaker than expected private job growth, financial markets are pricing in roughly 50-50 odds that the Fed cuts interest rates by half a percent at their September 18 decision versus a quarter percent. On the one hand, the Fed wants to prevent the slowdown of job growth from becoming a self-reinforcing decline. On the other hand, the Fed doesn’t want inflationary pressures to revive as rate cuts help credit-sensitive parts of the economy rebound."
10.55am: US macro data doesn't move the dial
A raft of US economic data has come out this morning, including the ISM services survey, and various jobs reports.
One of the main ones was the ADP private jobs print, which came in at 99K, down from a revised 111K and below the 145K consensus estimate.
Meanwhile, US weekly initial jobless claims came in slightly stronger than expectations.
The jobless claims was "a fairly strong print considering all the angst over the state of the US labour market", says Ryan Brandham, global capital markets chief at Validus, suggesting the slowing of the US labour market is "not too drastic".
"However, the market may focus more today on the weaker ADP print, which will lower market expectations for Friday’s NFP release and fuel calls for a 50 bp cut in September that is almost 50% priced in by markets.
"We continue to feel there is a risk the market has gotten ahead of itself and priced in a faster pace of cuts than the Fed will end up delivering, much like the beginning of 2024."
The ISM services index was essentially unchanged in August, which Stephen Brown, deputy chief North America economist at Capital Econpmics, says is "something of a relief following the weak ISM manufacturing report earlier this week and the gloomy tone of the Fed's Beige Book, released yesterday".
"In short, there was nothing in the ISM services report to sway the Fed’s decision about whether to kick off its loosening cycle with a 25bp or 50bp cut, which remains dependent on the August employment report tomorrow."
Although the ADP reported a lower rise in payrolls last month, Brown said "there is little correlation between that measure and the official payrolls release, so we continue to expect a 170,000 rise in non-farm payrolls and a small fall in the unemployment rate back to 4.2%".
Indeed, Wall Street is little moved, with the Nasdaq up 0.6% and the S&P 500 still flat.
9.52am: Nasdaq bounced back
Wall Street has got off to a mixed start, both on the front and back foot at the same time, with all the tangling that implies.
The Nasdaq Composite index is up 0.5%, with its six largest stocks all in positive territory, including a 2% rise for Amazon.com Inc (NASDAQ:AMZN), a 1% rise for both Apple Inc (NASDAQ:AAPL) and Alphabet Inc (NASDAQ:GOOG), while NVIDIA Corp (NASDAQ:NVDA) is up 0.5%.
Top riser in the Nasdaq 100 is Tesla Inc (NASDAQ:TSLA), up 3.2%, while biggest fallers are Copart Inc (NASDAQ:CPRT), Old Dominion Freight Line and AstraZeneca PLC (LSE:AZN).
As accurately predicted by the futures market, the S&P 500 is just above flat, up 0.1%, while the Dow Jones is down 0.1%.
The small-cap Russell 2000 is down 0.2%.
9.05am: US recession looming?
The predictive power of the yield curve has many fans who use it to forecast the US economic cycle, including macro strategist Jim Reid at Deutsche Bank.
In particular, the '2s10s' curve, the chart showing the difference between the 10-year yield and the 2-year yield, when it inverts from its usual positive spread has often pointed to a looming recession.
However, Reid says its predictive power in this cycle "looks to have malfunctioned", having been inverted for 26 months continuously, "which is the longest ever, and there still hasn't been a recession".
In the past 24 hours the 2s10s has poked its head into positive territory, so "it’s tempting to suggest we can sound the all-clear".
But Reid shares a chart to show "we're not out of the woods yet, as recessions start when curves are re-steepening and not when close to their maximum inversion point", as shown in the last four recessions, which only began once the curve was positive again.
"A positive sloping curve (if we continue to move in that direction) likely brings forward the moment of truth as to whether the yield curve has completely failed as a leading indicator in this cycle, or whether its powers were just felt later than in other cycles through history," says Reid.
7.30am: S&P and Nasdaq predicted to see flat start
Another mixed start for Wall Street stocks is expected on Thursday, though futures traders seem to be sitting on their hands ahead of economic data to come.
S&P 500 and Dow Jones futures are just above flat, while Nasdaq 100 futures are down 0.1%.
Asian Pacific stock indices steadied overnight following Wednesday’s sharp sell-off and European markets were mixed.
The dollar continued to pull back from recent highs, with the DXY dollar index down 0.25%.
Overall the market position "could be chalked up as a positive result, given Tuesday’s sharp tech-led sell-off which saw the former ‘market darling’ NVIDIA, lose 9.5%", said analyst David Morrison at Trade Nation.
He points to a clutch of employment data due out today, including Challenger job cuts, ADP payrolls and weekly unemployment claims, which help set the scene for tomorrow’s non-farm payroll release, "the highlight of this week".
"Another poor reading here would boost concerns that the Fed has waited too long to cut rates, raising the probability of a 50 basis point rate cut on 18th September.
"If so, investors may decide to cut their exposure to equities, particularly those at the forefront of the rally since last October."