Dow fell 219, decliners were modestly ahead of advancers & NAZ went up 43.  The MLP index added 1+ to the 282s & the REIT index slid back 1+ to the 427s.  Junk bond funds hardly budged & Treasuries were higher which reduced yields.  Oil was flattish in the low 69s & gold advanced 20 to 2546 (more on both below).

Dow Jones Industrials 

Mortgage rates in limbo as home sales remain 'lackluster'

Layoffs jump in August while hiring in 2024 is at a historic low, Challenger report shows

The number of Americans filing for unemployment benefits fell to its lowest level in 2 months last week, signaling that layoffs remain relatively low despite other signs of Labor Market cooling.  Jobless claims fell by 5K to 227K for last week, the Labor Dept reported.  That's the fewest since the week of Jul 6, when 223K Americans filed claims.  It's also less than the 230K new filings that were expected.  The 4-week average of claims, which evens out some of the week-to-week volatility, fell by 1750 to 230K, the lowest 4-week average since early Jun.  Weekly filings for unemployment benefits, considered a proxy for layoffs, remain low by historic standards, though they are up from earlier this year.  During the first 4 months of 2024, claims averaged a historically low 213K a week.  But they started rising in May.  They hit 250K in late Jul, adding to evidence that high interest rates were finally cooling a red-hot US job market.

Applications for US jobless benefits fall to 2-month low as layoffs remain at healthy levels

Gold prices rose to near 1-week highs, on the back of a weaker $ & lower yields after signs of labor market losing steam led investors to expect a super-sized rate cut from the Federal Reserve this month.  Spot gold was up 0.9% at $2515 per ounce, rising as much as 1.1% earlier in the session.  Prices slightly pared gains after the US services sector data.  US gold futures settled 0.7% higher at $2543.  US private employers hired the fewest number of workers in 3½-years in Aug, potentially hinting at a sharp labor market slowdown.  This follows data yesterday showing a sharp decline in US job openings in Jul.  Traders currently see a 59% chance of a 25-basis-point (bp) reduction by the central bank this month & a 41% chance of a 50-bp cut, according to the CME FedWatch tool.  Attention turns to the upcoming non-farm payrolls report tomorrow.

Gold Gains as Investors Anticipate Super-Sized Fed Rate Cut

WTI crude futures settled at $69.10 per barrel, remaining near a 14-month low, as concerns over slowing demand in the US & China, combined with the potential for increased oil supply from Libya, outweighed a larger-than-expected drop in US crude inventories.  The Energy Information Administration reported a 6.9M barrel reduction in stockpiles for last week ending, well above forecasts.  At the same time, OPEC+ delayed planned production hikes for Oct & Nov, which could tighten 4th-qtr supply by 100-200K barrels per day.  In Libya, despite political tensions, tankers began loading crude again.  Meanwhile, positive US economic data calmed fears over the Federal Reserve's potential interest rate cuts, with many anticipating a reduction at its Sep meeting.  Lower rates could help spur economic growth & boost oil demand.

Oil Settles Near 14-Month Low

Jobs market data serves as an appetizer for tomorrow's jobs report for Aug, crucial to the Fed's policy decision making & will be closely watched.  While recent soft readings make the case for deeper rate cuts, they could also be a sign the US is on the brink of recession & suggest a "soft landing" is no longer in the cards.