[New York Stocks] Markets Fall on Rate-Hike Concerns Following 'Surprise Employment Gains'; Tesla Plunges 5.9%

[Financial News]  

The three major U.S. stock indexes all fell on the 4th (local time).
The decline came as stronger-than-expected U.S. employment data for August increased the likelihood of a Federal Reserve rate hike.
Semiconductor stocks, meanwhile, performed strongly, with SanDisk surging 12% and Micron jumping 6%.
Tesla, however, plunged nearly 6% despite its Cybercab event the previous day.

The three major indexes, which had gained the previous day, all fell in Thursday's session.
The Dow Jones Industrial Average fell 271.86 points, or 0.51%, from the previous session to 53,414.25, posting the largest decline. The drop came as major technology stocks in the index struggled, with Apple down 2.51%, Microsoft off 2.04%, and Salesforce falling 1.97%.
The technology-heavy S&P 500 and Nasdaq posted relatively smaller declines.
The S&P 500 fell 29.11 points, or 0.38%, to 7,718.60, while the Nasdaq dropped 77.07 points, or 0.29%, to close at 26,506.99.
Despite the day's declines, all three major indexes rose on a weekly basis.
The Dow and S&P 500 gained 0.43% and 0.42%, respectively, while the Nasdaq rose 0.52%.

According to the U.S. Department of Labor, the unemployment rate remained unchanged at 4.1% in August, but the number of new jobs reached 162,000, far exceeding the market estimate of 53,000.
Although President Donald Trump pressured the United States to stop trading with countries that run trade surpluses against it unless interest rates were cut, concerns grew that the Fed could raise rates at the Federal Open Market Committee (FOMC) meeting on the 15th and 16th.
After the August employment report was released, the yield on two-year U.S. Treasury notes, which is highly sensitive to expectations for Fed policy, climbed to its highest level since January last year.
According to the CME FedWatch Tool from CME Group, the interest-rate futures market sees a 58% chance that the benchmark rate will rise by 0.25 percentage points on the 16th. The probability was 49.4% a day earlier.
Bradford Smith, a portfolio manager at Janus Henderson Investors, told CNBC, "The August employment data was overwhelming." He added that Kevin Warsh had already shown a hawkish stance at the Jackson Hole Economic Policy Symposium, leaving the Fed in a position to raise rates at any time depending on inflation data.

Big Tech stocks, including Tesla, generally struggled.
Tesla plunged after the previous day's Cybercab robotaxi event failed to attract Wall Street's attention and reports emerged that the U.S. National Highway Traffic Safety Administration (NHTSA) had launched an investigation into the safety of the Cybercab, which has no steering wheel or brake pedal. The stock fell $22.29, or 5.92%, from the previous session to close at $354.08.
Microsoft closed down $10.42, or 2.04%, at $499.70, while Apple fell $8.24, or 2.51%, to $319.97.
Alphabet fell $3.80, or 1.11%, to $338.46, while Palantir Technologies slid $8.20, or 4.49%, to $174.33.

Semiconductor stocks, led by NVIDIA, performed strongly. The sector is sensitive to interest rates because of its large-scale capital spending requirements, but this time it benefited from solid employment data. Strong employment raised expectations that the U.S. economy would remain healthy and that demand for data centers would stay robust.
NVIDIA gained $1.91, or 0.84%, to $230.36, while Intel surged $4.13, or 4.51%, to close at $95.80.
Micron recovered its $1,000 share price for the first time in 14 trading sessions since the 17th of last month. It surged $58.43, or 6.10%, to $1,016.59.
Flash-memory maker SanDisk soared $185.01, or 11.90%, to $1,740.00.
SK hynix American depositary receipts (ADRs) surged $13.32, or 8.14%, to $177.00.
Semiconductor exchange-traded funds (ETFs) also performed strongly.
The iShares Semiconductor ETF (SOXX) rose $17.66, or 3.52%, to $519.86, while the Roundhill Memory ETF (DRAM) jumped $3.70, or 6.61%, to close at $59.69.

[email protected] Kyung-jae Song Reporter