The Dow Jones Industrial Average reportedly dropped more than 800 points during afternoon trading on Friday, sending markets into a complete meltdown.
According to Labor Department data, job growth abruptly stopped in July, and the unemployment rate reached its highest point since 2021.
The information supports the theory that a labor market that was already beginning to lose vigor might be headed toward complete collapse under President Biden’s watch.
According to the government, hiring fell short of forecasts last month, reaching just 114,000 positions. Reaching its highest point in almost three years, when the economy was still struggling to recover from the pandemic, the jobless rate increased to 4.3%.
Following the release of the report, stock prices plummeted precipitously, indicating investors’ rekindled concerns about an impending economic recession.
With a roughly 3% decline, the tech-heavy Nasdaq Composite was headed into correction territory, meaning it would have dropped at least 10% from its previous peak.
Some investors are beginning to wonder if the madness surrounding artificial intelligence, which has driven tech stocks this year, has reached a breaking point in light of the disappointing earnings from large technology companies.
There will undoubtedly be further discussion about whether the Federal Reserve is lowering interest rates too slowly now that the jobs report has been out.
While leaving rates unchanged on Wednesday, Federal Reserve policymakers made a clear indication that they would likely cut them in September.
Investors are beginning to wonder if the Federal Reserve has waited too long to lower interest rates.
Additionally, the rate of hiring has decreased significantly, another warning sign for the U.S. economy. According to Labor Department data released on Tuesday, the number of hires as a percentage of all positions fell to 3.4% in June, the lowest level since April 2020.
A sudden economic shock in the coming weeks could also upend the already chaotic U.S. presidential election between Kamala Harris and former President Donald Trump.
[READ MORE: Israel Killed Hamas Leader in Tehran With Secret Bomb Smuggled Into Guesthouse Two Months Before]
