US benchmark equity indexes experienced a downturn during intraday trading, with Treasury yields climbing sharply as markets assessed the latest economic data indicating stronger-than-expected job additions in December. The Dow Jones Industrial Average and the Nasdaq Composite both fell by 1.2% to 42,149.3 and 19,252.9 respectively, while the S&P 500 dipped by 1.1% to 5,854.7.
Among the various sectors, financials and real estate reported the most significant declines, contrasting with energy and communication services, which managed to secure gains. The US stock markets were closed on Thursday in remembrance of former President Jimmy Carter. In economic developments, the US Bureau of Labor Statistics revealed that total nonfarm payrolls increased by 256,000 last month, markedly surpassing the consensus expectation of a 165,000 increase, according to a survey conducted by Bloomberg. Market analysts at BMO commented, 'This was a robust employment report that reinforces the resilience of the US labor market and expansion and will keep the Federal Reserve on hold in January as they try to bring inflation pressures down.' Consensus expectations indicate that the Federal Open Market Committee is likely to keep interest rates unchanged at the upcoming meeting this month, as per the CME FedWatch tool. Intraday, the US two-year Treasury yield surged by 11.4 basis points to 4.38%, while the ten-year yield rose by 8.2 basis points to 4.76%. In corporate news, Constellation Brands ($STZ) saw its shares fall by 17%, marking the worst performance on the S&P 500, following the company’s revision of its annual sales outlook after failing to meet Wall Street expectations for its fiscal third-quarter results. Walt Disney's ($DIS) ESPN, along with Fox ($FOXA, $FOXA) and Warner Bros.
Discovery ($WBD), announced the cancellation of their planned Venu Sports streaming service. Warner Bros. shares dropped by 5.1%, making it the second worst performer on the Nasdaq, while Disney's stock fell by 0.4%. Meanwhile, Fox's class A and B shares both declined by more than 1.5%. Constellation Energy ($CEG) reached an agreement to acquire the privately held energy firm Calpine in a cash-and-stock transaction valued at $26.6 billion, including debt.
As a result, Constellation Energy's stock surged nearly 27%, becoming the best performer on the Nasdaq and the second-best on the S&P 500. Walgreens Boots Alliance ($WBA) emerged as the top gainer on the S&P 500, posting a remarkable rise of 28% following better-than-expected results for its fiscal first quarter.
The drugstore chain reported robust sales growth across its divisions and reaffirmed its full-year earnings outlook despite a challenging retail environment in the US. On the commodities front, West Texas Intermediate crude oil experienced a rise of 3.1% to reach $76.19 per barrel. D.A. Davidson noted that 'Oil prices gained, driven by concerns over potential supply disruptions due to increased sanctions on Russia and Iran.' Gold prices increased by 0.9%, reaching $2,713.20 per troy ounce, while silver rose by 0.8% to $31.25 per ounce..