ASX set to slide as Wall Street slumps on Trump tariffs, jobs shock
The S&P 500 fell 1.6 per cent, its biggest decline since May 21 and its fourth straight loss. The index also posted a 2.4 per cent loss for the week, marking a sharp shift from last week's record-setting streak of gains.
The Dow Jones fell 1.2 per cent, while the Nasdaq composite fell 2.2 per cent. The Australian sharemarket is set to retreat, with futures pointing to a slide of 32 points, or 0.4 per cent, at the open. The Australian dollar was fetching 64.63 US cents at 5.19am AEST.
Worries on Wall Street about a weakening economy were heavily reinforced by the latest report on job growth in the US Employers added just 73,000 jobs in July. That is sharply lower than economists expected. The Labor Department also reported that revisions shaved a stunning 258,000 jobs off May and June payrolls.
Markets also reacted to the latest tariff news. President Donald Trump announced tariff rates on dozens of countries and pushed back the scheduled effective date to August 7, adding more uncertainty to the global trade picture.
'The market has been felled by a one-two punch of additional tariffs, as well as the weaker-than-expected employment data -— not only for this month, but for the downward revisions to the prior months,' said Sam Stovall, chief investment strategist at CFRA.
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Trump's decision to order the immediate firing of the head of the government agency that produces the monthly jobs figures will only fuel the market's uncertainty, Stovall added.
The surprisingly weak hiring numbers led investors to step up their expectations for an interest rate cut in September. The market's odds of a quarter-point cut by the Federal Reserve rose to around 87 per cent from just under 40 per cent a day earlier, according to data from CME FedWatch.
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