US Market Reaction Ahead Of Jobs Report, RBI Policy; Dow Jones, S&P 500, Nasdaq Fall On December 5

US Market: Wall Street pulled back from its fresh record rally on Thursday, December 5, 2024, with Dow Jones falling by 0.6%, while S&P 500 and Nasdaq Composite closed with marginal downside. The performance comes ahead of the key jobs report which is expected to clarify the Fed's rate cut outcomes. Also, the dip comes before RBI's policy announcement which will be announced on Friday. The tensions in the Middle East take a new twist with Syria's surprise civil war against Bashar al-Assad's regime amidst Israel's war with Hamas and Iran. Meanwhile, South Korea's ruler President Yoon Suk Yeol continues to face fresh backlash from the parliament.

US Market On December 5, 2024:

Dow Jones: The Dow Jones Industrial Average or DJIA ended at 44,765.71, down by 248.33 points or 0.55%.

S&P 500: This index closed at 6,075.11, lower by 11.38 points or 0.19%.

Nasdaq Composite: The index ended at 19,700.72, below 34.39 points or 0.17%.

As per Trading Economics, US stocks closed lower on Thursday, retreating from records as investors tread cautiously ahead of Friday's pivotal jobs report, which could influence the Federal Reserve's December rate decision.

Trading Economics added that the weekly jobless claims rose to 224,000, slightly above expectations, indicating a cooling labour market. Friday's non-farm payrolls report is anticipated to show a gain of 200,000 jobs, with weaker data potentially bolstering expectations for a rate cut, currently at a 74% probability for a 25-basis-point reduction at December's meeting. On the corporate front, crypto-related stocks like Coinbase (-3.1%) and MicroStrategy (-4.5%) pared earlier gains even after Bitcoin broke past $100,000 for the first time. Tesla climbed 3.2%, and American Airlines jumped 16.7% after naming Citigroup its exclusive credit card partner. Eli Lilly and UnitedHealth fell 0.5% and 5.2%, respectively, as sector losses weighed on markets.

Global News:

In India, the key focus will be on RBI which is going to declare the outcomes of the December 2024 policy meeting. It is expected that the six-member MPC will keep the repo rate unchanged at 6.5% for the eleventh time in a row, once again defying the US Federal Reserve's rate cut cycle. The key reason for RBI to stay status quo is the slowest growth of GDP in 2 years and the sharp surge in CPI inflation in over 1 year.

Meanwhile, in South Korea, President Yoon is now being investigated by the police for potential insurrection owing to his sudden and dramatic martial law action. Both domestically and internationally, Yoon's decision of martial law that sought a ban on political activities and media censoring - has received immense outrage.

Further, in the Russia-Ukraine war, days before his exit, President Joe Biden vowed to supply Ukraine with weapons like the Army Tactical Missile System (ATACMS) to deepen the strike in Russia. Biden's administration has further announced a military and of $725 million (about Rs 6,139 crore). This comes as a setback for Donald Trump's 2.0 who is expected to ease the tension with Russia-Ukraine once his regime commences.

Coming to the Middle East, amidst a war between Israel and Hamas and tensions with Iran, Syrian rebels have taken a bold move. According to Reuters, Syrian rebels captured the city of Hama on Thursday, a major victory in a week-old lightning advance across northern Syria and a devastating new blow to President Bashar al-Assad and his Russian and Iranian allies. The capture of Hama gives them control of a strategic central city they had never managed to seize before.