Weaker labor market stokes fears of a downturn, spurs market sell off
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Employers added 114,000 jobs in July and the unemployment rate spiked to 4.3 percent, reflecting a weaker-than-expected labor market that is stoking fears that interest rates have been too high for too long.
With the unemployment rate now at the highest rate since coming out of the pandemic downturn in 2021, economists, banking analysts and investors warned that recession signals are flashing.
Financial markets on Friday reflected worries that the Federal Reserve missed an opportunity to save the economy from a downfall with a September rate cut, reversing recent optimism about the strength of the economy. All three of the major stock indices opened down significantly, with the S&P 500 falling by 1.2 percent upon opening Friday and the tech-heavy Nasdaq down by around 3 percent.
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