US stocks stage comeback as oil slides further on US economy worries
NEW YORK — US stocks bounced back from an early morning slump to close higher Tuesday as fresh data showed that job vacancies slipped in April to their lowest level since 2021.
Stock markets in Europe and Asia fell, while oil prices slid as the prospect of easing demand worldwide accompanied an announcement from the OPEC+ alliance of major crude producers that it would roll back production cuts starting in October.
The price of a barrel of both Brent Crude and West Texas Intermediate fell more than one percent on Tuesday, building on recent declines.
Investors have shifted nervously in recent weeks on concerns the Fed will not cut interest rates until 2025 as inflation remains stubbornly above target.
Decision-makers have warned against moving too early, insisting on seeing more evidence that price rises are under control.
But fears of persistent economic weakness have moved to the fore after the Institute for Supply Management (ISM) said Monday that its manufacturing index showed that US activity contracted for a second successive month in May.
And on Tuesday, the Labor Department’s jobs opening and labor turnover survey (JOLTS) saw vacancies slip to just under 8.1 million in April, 300,000 fewer than a month earlier, and well below market expectations, according to Briefing.com.
READ: US job openings fall to 8.1 million, lowest since 2021
The Dow Jones Industrial Average shook off an early slide to close up 0.4 percent Tuesday, while the broad-based S&P 500 and the tech-rich Nasdaq Composite Index both rose by 0.2 percent.
“We have a turnaround in the market,” Peter Cardillo from Spartan Capital told AFP, adding that the market had reversed course, while some US Treasury yields fell.
“We had factory orders which came in line with market expectations and there were fewer job openings, a sign that the labor market is unwinding a bit, and that’s also why we are seeing the yield going lower,” he added.
India election causes a slump
Earlier Tuesday, stock indexes in Asia ended broadly lower, led by a nearly 6 percent slump in India as it appeared India’s Prime Minister Narendra Modi would not win as big an election victory as expected.
READ: Asian shares fall after report shows US manufacturing contracted in May
The Sensex had jumped more than three percent Monday on hopes a big majority would help Modi push through economy-boosting measures.
But while Modi’s Bharatiya Janata Party looked set to win India’s national elections, results so far suggest it would not be the landslide initially expected.
Investors are now focused on Thursday’s European Central Bank interest rate decision, where expectations are high that it could begin cutting interest rates.
They are also looking ahead to Friday’s release of US non-farm payroll figures for a fresh snapshot of the labor market in the world’s biggest economy.
