US stock markets took a dip on Thursday, with major indexes experiencing losses amid signs of a cooling labor market and rising oil prices. The ADP report, which tracks private sector job creation, showed a significant slowdown in growth for August, coming in at 99,000 jobs. This figure represents the slowest pace of growth since January 2021 and missed the forecast of 140,000 jobs. While a stronger-than-expected services sector activity sentiment for August offered some respite from broader recession concerns, an employment subindex reinforced indications of a cooling labor market.
The S&P 500 index, a broad measure of US stock performance, fell below the 4,500 support level for the first time since mid-August, extending its weekly losses to 2.9%. This puts the index on track for its worst week since mid-April. Tech stocks managed to limit their losses, with semiconductor shares holding steady. However, blue-chip stocks underperformed, with the Dow Jones Industrial Average dropping 0.8%, while small-cap stocks fell 0.6%.
Adding further pressure to already fragile investor sentiment was OPEC+’s decision to delay an October oil production increase by two months. This move supported crude prices, with West Texas Intermediate (WTI) crude halting its decline after experiencing its worst two-day slump since October 2023.
Treasury yields dipped slightly, and the US dollar weakened. Meanwhile, gold prices edged higher by 0.6%. Natural gas emerged as Thursday’s top performer, with Henry Hub prices surging over 5%. The US Energy Information Administration reported a natural gas storage injection of 13 billion cubic feet (Bcf) for the week ending August 30, significantly lower than historical averages and expectations. Sentiment in crypto assets deteriorated, with Bitcoin tumbling 3% to $56,170.
In terms of individual stock performance, Tesla Inc. (TSLA) rallied 4% after announcing plans to roll out its Full Self-Driving (FSD) technology in China and Europe during the first quarter of 2025, subject to regulatory approvals. The electric vehicle maker will also begin producing a six-seat Model Y variant in China starting next year.
Verizon Communications Inc. (VZ) announced an agreement to acquire Frontier Communications Parent Inc. (FYBR) in an all-cash deal valued at approximately $20 billion. Verizon shares eased 0.6%, while Frontier Communication Parent shares plummeted 9% after rallying 37% on Wednesday. United Steel Corp. (X) rose 4% after tumbling 17% on Wednesday. According to Reuters, the Committee on Foreign Investment in the U.S. (CFIUS) has raised concerns about potential national security risks related to Nippon Steel’s planned $14.9 billion acquisition of US Steel.
NIO Inc. (NIO) rallied 11% in response to upbeat quarterly results and improved guidance. Other stocks reacting to earnings releases included The Toro Company (TTC), down over 10%, Copart Inc. (CPRT), down 6.7%, Hewlett Packard Enterprise Co. (HPE), down 5.3%, Core & Main, Inc. (CNM), down 0.7%, Credo Technology Group Holding Ltd (CRDO), and C3.ai, Inc. (AI), both down around 13%. Companies reporting results after the close included Broadcom Inc. (AVGO), Samsara Inc. (IOT), DocuSign Inc. (DOCU), Ui Path Inc. (PATH), and Smartsheet Inc. (SMAR).
