After stocks fell sharply in Tuesday morning trading, some on Wall Street smelled a chance to buy the dip.
The Dow was down just 376 points, or 0.8%, after falling more than 500 points. The S&P 500 cut its decline to 1% and the Nasdaq Composite dropped 1.2%.
Magnificent Seven stocks, which were dropping fast earlier, were also off their lows. The Roundhill Magnificent Seven ETF was down to 1.5%.
The yield on the 2-year Treasury note was up to 3.67%. The 10-year yield was up to 4.29%. The yield on the 30-year note was up to 4.98%.
The market’s slight recovery suggests traders are mostly just antsy heading into a seasonally tough period with a high-stakes employment report due out on Friday.
“There’s some beginning-of-month positioning, and I think that you’re going to see a little bit of profit taking like we’re seeing today, but the jobs report is going to be the big thing,” Sevens Report Research’s Tom Essaye told Barron’s.
If the report reinforces a picture where growth is solid against a backdrop of not-too-substantial inflation that would allow rate cuts to proceed, that would be a positive for the market.
“If we get the opposite where the jobs report is weak, then you’ll see growth concerns spike like you saw in August, and now all of a sudden the market is kind of over its skis a bit,” Essaye says.
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