Nasdaq leads stock declines while oil spikes on Iran attack

US stocks slid on Tuesday after Iran fired over 100 ballistic missiles at Israel, pushing oil prices for West Texas Intermediate (CL=F) and Brent (BZ=F) to their biggest increases in nearly a year.

The Dow Jones Industrial Average (^DJI) fell more than 0.1%, while the S&P 500 (^GSPC) fell about 0.6% after both major indexes capped last month — and quarter — with fresh record highs. The tech-heavy Nasdaq Composite (^IXIC) lost more than 1.2%.

Meanwhile, new jobs and manufacturing data kicked off the new quarter as investors searched for further clues on the future of the Federal Reserve’s easing cycle after Fed Chair Jerome Powell hinted the central bank is not in a rush to rapidly cut rates.

Job openings surprisingly increased in August, furthering the narrative that while the labor market is cooling, it’s not rapidly slowing. New data showed there were 8.04 million jobs open at the end of August, an increase from the 7.71 million seen in July.

US manufacturing held steady in September. The Institute for Supply Management (ISM) said its manufacturing PMI was unchanged at 47.2 last month. Despite holding steady, the reading still came in weak, as a PMI below 50 indicates a contraction in the manufacturing sector.

Read more: What the Fed rate cut means for bank accounts, CDs, loans, and credit cards

The data sets investors up for Friday’s September jobs report, the highlight in a week full of closely watched economic data. Investors are watching for confirmation that the US economy is cooling, rather than crumbling.

In other news, a strike by dockworkers began on the East and Gulf coasts, threatening to halt the flow of half the US’s ocean shipping. Disruption from the large-scale stoppage could cost the economy billions of dollars a day, stoke inflation, put jobs at risk, and reverberate through US politics.

Live11 updates

Tue, October 1, 2024 at 9:30 PM GMT+2

Here comes Nike’s earnings report…

Nike (NKE) is set to report its fiscal first quarter earnings after the bell on Tuesday

Yahoo Finance’s Josh Schafer has a preview of what to expect:

Nike’s Q1 earnings will be the first report since the company announced a CEO change amid lackluster sales growth.

Elliott Hill, a former Nike executive who retired in 2020, will replace John Donahoe as CEO on Oct. 14. The news initially sent Nike stock up as much as 10%.

“Long-time NKE veteran Elliott Hill returning as CEO and its implications on NKE’s turnaround strategy is likely to dominate the narrative of the 1Q print,” Citi analyst Paul Lejuez wrote in a note to clients previewing the earnings.

Nike stock has slumped this year, falling more than 25% prior to the CEO changeup announcement on Sept. 19 amid concerns over slowing sales growth and pressure from rising competitors in the space like On (ONON) and Deckers’ (DECK) Hoka brand.

Nike has reported single-digit revenue growth, or worse, for five straight quarters and Wall Street analysts don’t expect that trend to change much in the company’s fiscal first quarter.

Consensus expectations are for the sports apparel brand to report quarterly revenue of $11.65 billion with earnings per share of $0.52. Both metrics would represent year-over-year declines from the same quarter a year ago.
Tue, October 1, 2024 at 8:55 PM GMT+2

Americans quit their jobs at the lowest rate since 2020 in August

Workers are becoming increasingly wary of searching for new jobs amid a slowing labor market.

New data from the Bureau of Labor Statistics released Tuesday showed that the quits rate, a sign of confidence among workers, ticked down to 1.9% in August from July’s 2%, marking the slowest pace since June 2020. Excluding the pandemic, the quits rate is at its lowest level since 2015.

Meanwhile the Job Openings and Labor Turnover Survey (JOLTS) showed 5.31 million hires were made during the month, down from the 5.41 from July. The hiring rate hit 3.3% in August down from the 3.4% in July. Excluding the pandemic, the hiring rate was at its lowest level since 2013 in August.

As seen in our chart of the day, both hiring and quits have declined significantly over the past year, marking a labor market that’s a far cry from the days of “quiet quitting”when hefty wage increases were being flaunted at workers who switched their jobs. Notably, the metrics aren’t at the levels seen during the doldrums of 2008 and 2009, but they are still providing a clear image about the current state of the labor market.

“It’s a really tough time to find a job,” Guy Berger, the director of economic research at The Burning Glass Institute, a research center that studies labor data, wrote in a thread on X Tuesday.
Tue, October 1, 2024 at 3:34 PM GMT+2

Stocks off to slow October start

US stocks opened lower on Tuesday to kick off the first trading day of October and the fourth quarter.

The Dow Jones Industrial Average (^DJI) slid roughly 0.4%, while the S&P 500 (^GSPC) fell about 0.3% after both major indexes secured a fresh record close on Monday. The tech-heavy Nasdaq Composite (^IXIC) also moved to the downside, dropping around 0.3%.
Tue, October 1, 2024 at 3:19 PM GMT+2

Stellantis stock drops further on Jeep recall over fire risks

Jeep-maker Stellantis (STLA) edged down 1% in premarket trading Tuesday after issuing a recall for over 150,000 hybrid Jeep SUVs over a “potential fire risk.”

The drop in Stellantis shares comes just a day after the stock plummeted 12.5% in reaction to the automaker’s gloomy outlook for its North American operations. Stellantis — which also manufactures Dodge and Ram cars — said it expects to record profit margins of 5.5% to 7% for the full year, rather than its previous double-digit guidance. To weather deteriorating conditions in the global auto industry, the automaker has planned cost-cutting measures and discounts, Yahoo Finance reporter Pras Subramanian explained on Market Domination.

Meanwhile, the newly issued recall affects 2020-2024 Jeep Wrangler 4xe and 2022-2024 Jeep Cherokee 4xe SUVs. The company said it found 13 fires linked to the issue in an internal investigation, but it estimates that only 5% of recalled vehicles exhibit the fire risk.
Tue, October 1, 2024 at 2:47 PM GMT+2

Barclays pulls no punches on Apple

Barclays analyst Tim Long dropped the mic on Apple (AAPL) this morning in a new note, calling out weak demand for the iPhone 16.

Here’s what Long had to say:

“There was a lot of news about increased iPhone builds in early July, a few weeks after the introduction of Apple Intelligence. Based on our recent supply chain channel checks, we believe AAPL may just have cut roughly 3 million units at a key semiconductor component in iPhones for the December quarter, which if confirmed would be the earliest build cut in recent history. Our sell-through checks point to 15% declines year over year for global iPhone 16 in the first week of sales. We also tracked iPhone availability across geographies globally, which suggest softer demand for IP16 relative to last year. Wait times across major geographies we tracked were much shorter vs. last year. While the supply chain constraints on IP15 pro models extended lead times last year, it nevertheless points to potentially weaker-than-expected demand, especially across US and China. All of the above data points point to softer demand than previously anticipated.”

Long reiterated an Underweight rating on Apple (Sell equivalent).