The US stock market is on its way to one of the worst weeks in many months, after a series of dizzying policy shifts at rates from the White House. A new job report on Friday will offer a crucial lecture about the power of the economy, which has become a growing care for investors.
Futures on the S&P 500 pointed to a moderate start of trade when the markets open. The benchmark index has already fallen 3.6 percent this week, the worst week since September. It is on course for the third consecutive week of losses, a sharp mood shift since the index became a record less than a month ago.
Since then, investors have been worried about the process for economic growth, exacerbated by rates about the import of the largest trading partners in the country. Surveys also show increasing concern among consumers.
Investors who had hoped that President Trump's tariff threats were only a negotiating tactic, were disappointed on Tuesday when 25 percent rates came into effect on Mexico and Canada, and another 10 percent rates for China. On Thursday, concessions were made, in which the rates for many goods from Canada and Mexico were suspended, but it was unable to burn in a rally.
If the banengies released on Friday, see a slower pace of recruitment in February, this can aggravate concern about the economy.
“I think the markets essentially take President Trump a little more seriously for rates,” said Jim Caron, Chief Investment Officer of the Portfolio Solutions Group at the Morgan Stanley Investment Institute. He said that despite the recent sale, large stock indexes remain close to record heights, and although concerns about the economy are rising, the economy remains in good condition.
Much of the sale is powered by large technology companies. Because of their size, even small changes in their stock prices can have a major effect on wide indexes. Since the S&P 500 peak on February 19, the index has fallen by 6.6 percent. A separate measure that gives all shares an equal weight in the index has only fallen 4.4 percent in the same period.
What is not clear is whether investors sell because they see the tide running for technology companies or because of broader care.
“In the past weeks, and perhaps for the coming weeks, we have completed a very challenging news cycle,” said Mr Caron. “We have to get through it and assess how much damage there is to markets.”
