Wall Street falls despite good employment data: bets on rate hike increase

WHAT HAPPENED

The United States created 162,000 jobs in August, almost triple what was expected. Unemployment remained at 4.1%, but the markets fell: the S&P 500 dropped 0.38%, the Nasdaq 0.29%, and the Dow Jones 0.51%.

WHY IT MATTERS

Strong employment gives the Fed more room to raise its interest rate. This makes credit cards, auto loans, variable mortgages, and loans more expensive; it also pressures real estate and technology. That’s why the Nasdaq fell, even though the labor data was positive.

AND FOR YOUR PORTFOLIO

For someone with debt, a higher rate can add several tens of dollars to the monthly payment. For those with savings in interest-paying instruments, it can mean better returns. In long-term investments, rates can also affect stock prices.