Concerns regarding a potential slowdown in the U.S. economy contributed to declines on Wall Street on Thursday, with companies announcing job cuts and hiring freezes. The S&P 500 index fell by 1.1%, while the Nasdaq Composite, heavily weighted by technology stocks, dropped 1.9%. Investors noted a recent report indicating that October marked the highest number of layoffs in the U.S. since 2003, with 153,074 job cuts reported, a significant increase from 55,597 in October 2024.
The job cuts reflect trends noted in a report from global outplacement firm Challenger, Gray & Christmas, which stated that U.S. firms have announced over 1 million role terminations in the first ten months of the current year, showing a 44% increase compared to the same period in 2024. Technology firms were identified as leading the layoffs in the private sector.
Market analysts indicated that the absence of formal economic data, compounded by the federal government shutdown, has left investors uncertain. Chris Beauchamp, chief market analyst at IG.com, mentioned that ongoing delays in data releases have heightened investor anxiety. This situation has similarly affected the Federal Reserve, limiting the information available for assessing the economy and making decisions on interest rates. Fed board member Austan Goolsbee expressed caution regarding potential interest rate cuts due to the lack of inflation data amid the shutdown.
European markets also experienced declines, with the FTSE 100 falling 41 points or 0.4%, and the Stoxx Europe 600 closing 0.7% lower. Concerns were raised about potential changes to tariffs following a Supreme Court review, which might alleviate some inflation concerns, although the implications of such decisions may take time to materialize. Overall, fears of overvaluation in tech stocks persist as significant investments continue to flow into artificial intelligence.
Source: https://www.theguardian.com/business/2025/nov/06/us-stock-market-values-tumble-amid-reports-of-high-layoffs-and-hiring-freezes