Wall Street saw a broad flight from risk assets, with stocks sinking amid mounting signs of job-market weakness, President Donald Trump’s latest volley of tariffs and geopolitical worries.
Short-term Treasury yields plunged the most since 2023 on bets the Federal Reserve will cut rates.
The S&P 500 sank 1.6%, the most since May. An uninspiring outlook from Amazon.com Inc. spurred a rout in megacaps. A closely watched volatility gauge – the VIX – topped 20.
Two-year yields tumbled 28 basis points to 3.68%. The dollar snapped a six-day advance. Gold climbed as Trump said the US is moving two nuclear submarines to respond to “provocative” statements from former Russian President Dmitry Medvedev.
Job growth cooled sharply and the unemployment rate rose, with payrolls increasing 73,000 in July after the prior two months were revised down by nearly 260,000.
In the last three months, employment growth has averaged a paltry 35,000. Money markets fully priced in two rate cuts in 2025, with a 90% chance of a reduction in September.
