Stocks tumbled Friday, concluding the most volatile stretch the market has seen in more than a year by some 🔯measure🧸s.

The S&P 500 shed 1.8% to close lower for the third consecutive week, its🧸 longest loꦐsing streak since April. 

The 澳洲幸运5开奖号码历史查询:VIX surged to its highest point all year on Friday after data showed the 澳洲幸运5开奖号码历史查询:unemployment rate jumped to 4.3% in July.

It has been nea✅rly a year since stocks experienced swings as violent as the ones ꦚseen recently. In the past 10 trading days, there were six sessions in which the S&P 500 rose or fell more than 1%, the most since November. 

By another measure, stocks are moving more dramatically now than they have in more than a year. Over the last 10 days, the average daily move was 1.🔯02%, the highest since March 2023.

Why Has Market Volatility Increased?

Last month’s 澳洲幸运5开奖号码历史查询:soft inflation report stands out as the primary culprit of all this volatility. There wasn’t a single day that the S&🦋P 500 moved mor൩e than 1% between June 6 and July 9, two days before the inflation data surprised Wall Street. 

Earnings, specifically big tech earnings, have exacerbated volatility. This week, when four of the world's largest tech companies reported quarterly results, there were three days in which the S&P 500 rose or fell by more than 1%.

Jitters have set in about high-flying mega-cap tech stocks as investors have become more demanding of market darlings like the 澳洲幸运5开奖号码历史查询:Magnificent Seven. For more than a year, most of the group consistently reported double-digit ear🔯nings growth as cost cuts, mostly achieved through layoffs and restructuring, boosted their bottom lines. 

Now, investors are again concernedꦦ about spending, but their focus 💦has shifted. Wall Street was worried about personnel costs in 2022 after tech companies went on a hiring spree to meet peak-pandemic demand. 

Today, the problem is infrastructure. Investors balked at 澳洲幸运5开奖号码历史查询:surging capital expenditures at tech giants like Alphabet (GOOGL), Microsoft (MSFT), and Amazon (AMZN), all of which are buying up semiconductors, real estate, and da🐈ta center hardware at a blist𒁏ering pace to satisfy surging demand for artificial intelligence. 

The companies have 澳洲幸运5开奖号码历史查询:vigorously defended their investment, saying underspending on AI and falling behind competitors is a far greater risk than overspending. Meta's (META) be🐎tter-than-expected results on Wednesday eased some of the Street's fear𝓰s, but disappointing results from Amazon on Thursday reignited the debate about AI spending.

A Shaky Economy Has Investors on Edge

At the same time, investors are becoming increasingly concerned about the state of the economy. Fed Chair Jerome Powell may have opened the door to 澳洲幸运5开奖号码历史查询:a September rate cut at a pres𓃲s conference earli꧑er this week, but a relatively abrupt slowdown in the labor market has some wondering if it's not already too late. 

Friday's jobs report 澳洲幸运5开奖号码历史查询:triggered the Sahm rule, a recession indicator that is based on how quickly♏ t💜he unemployment rate increases.

Powell, when asked about the rule earlier this week, noted that plenty of other indicators, like the 澳洲幸运5开奖号码历史查询:inverted yield curve, have for some time sign⛎aled a recession that hasn't coꦉme.

"What we think we're seeing is a normalizing labor market," he said, pointing to strong but slowing wage growth and fewer vacancies as evidence of the job market's rebalancing.

"We're watching carefully to see if it turns out to be more," he added, referring to the labor market's cooldown. If Friday's report seems to the Fed to be evidence of a more dramatic deterioration in the labor market, Powell said the central bank is "well-positioned to respond."

After Friday's jobs data, financial markets are pricing 125 basis points, or 1.25 percentage points, of rate cuts by the end of 2024, up from 75 basis points the day before, according to the CME Group's FedWatch tool, which forecasts interest rate movements based on fed funds futures trading data. The likelihood priced in of a half-point cut at the September FOMC meeting is now around 72%, up from 22% on Thursday.