MSCI’s regional equities gauge dropped 0.1%, extending its losses to a third consecutive day. That’s after the S&P 500 also fell for a third day Tuesday, while the Nasdaq 100 added 0.3%. Tesla Inc. shares declined about 1% in extended trading after the company’s sales in California were poised to be suspended for 30 days.
Meanwhile, West Texas Intermediate crude oil rose more than 1% after President Donald Trump said he was ordering a “total and complete blockade of all sanctioned oil tankers” going into and leaving Venezuela.
The latest US labor data signaled a cooling jobs market — but not one rapidly weakening — prompting traders to hold off on increasing bets for near-term rate cuts. After Tuesday’s report, markets priced in roughly a 20% chance of a January reduction. Attention will now turn to Thursday’s inflation numbers for clues on whether the narrative may shift in the final full trading week of the year.
“We take a glass half full, rather than a glass half empty, view of the combined part-October, full November employment report and, more importantly, we think the Fed will too,” Evercore ISI economist Krishna Guha wrote in a note. “Specifically we do not think this was weak enough to spur another near-term rate cut.”
Nonfarm payrolls increased 64,000 in November after declining 105,000 in October amid a contraction in federal employment. The unemployment rate was 4.6% last month, up from 4.4% in September and the highest since 2021.
The US central bank is seen as less likely to put much weight on the data due to disruptions caused by the US government shutdown. “While the labor market reports were soft, the data need to be treated with caution following the government shutdown,” said ANZ Group Holdings Ltd. analysts Brian Martin and Daniel Hynes. “Uncertainty surrounding the timing of the FOMC’s next move is unlikely to be resolved until the data flow normalizes next year.”
A separate report out Tuesday showed retail sales were little changed in October as a decline at auto dealers and weaker gasoline receipts offset stronger spending in other categories. And figures from S&P Global showed US business activity expanded in December at the slowest pace in six months, while a measure of input prices jumped to a more than three-year high.
Meanwhile, the Trump administration has also threatened retaliation against the European Union in response to efforts to tax American tech companies, singling out prominent companies, including Accenture Plc, Siemens AG and Spotify Technology SA, as possible targets for new restrictions or fees.
In Asia, investors will be focused on Chinese stocks in Hong Kong after they neared key bearish technical levels on Tuesday as fading tech gains and renewed economic growth concerns fueled a sharp selloff. A gauge of Chinese shares listed in the US fell for a fourth straight day.
Oil rose from the lowest level since 2021 after Trump ramped up pressure on Venezuela. The move represents an escalation and follows the seizure of an oil tanker last week by US forces off Venezuela. Trump said he was also designating the regime of President Nicolas Maduro a foreign terrorist organization.
West Texas Intermediate climbed above $56 a barrel after tumbling almost 6% over the previous four sessions. Brent settled just below $59.