Market Overview

Ahead of U.S. nonfarm payroll data, despite the August ISM services activity expanding moderately for two consecutive months, ADP private sector employment growth hit a three-and-a-half-year low, signaling further labor market cooling. This added support to strong rate cut bets due to economic concerns.

U.S. stocks initially rose but quickly reversed. $Nasdaq Composite Index (.IXIC.US)$ ended a two-day losing streak but closed far below its initial 1.2% rise. $S&P 500 Index (.SPX.US)$ and $Russell 2000 Index (.RUT.US)$ both fell for the third day in a row. The chip index dropped 0.6%, while the China ADR index rose 0.9%. Among the "Big 7" tech stocks, only $Microsoft (MSFT.US)$ fell, with $NVIDIA (NVDA.US)$ gaining 0.9% and $Tesla (TSLA.US)$ jumping nearly 5%. AI stock $C3.ai (AI.US)$ initially plunged 18%, but its loss halved. Earnings boosted $NIO Inc (NIO.US)$ , which surged over 14%. European stocks fell for the fourth straight day.

Weaker jobs data weighed on the dollar and U.S. Treasury yields. The 2-year Treasury yield fell nearly six basis points at one point, extending its three-day losing streak to its lowest level in over a year. The 10-year yield dropped five basis points, briefly eliminating the inverted yield curve for the third time in two years. The dollar index slipped below 101.

Rising expectations of a Bank of Japan rate hike and its safe-haven appeal helped the yen gain for the third consecutive day. The Chinese yuan reached its highest in 16 months. Bitcoin fell more than 3%, nearing $56,000, close to its lowest in a month.

Spot gold surged over 1%, briefly topping $2,520, while silver spiked over 3%. Copper rose 1.5%. Singapore iron ore futures fell to their lowest since November 2022. OPEC+'s decision to delay production increases by two months, combined with a sharp drop in U.S. crude inventories, failed to lift oil prices.