S&P 500 futures were down 0.87% this morning. Markets in Asia and Europe were almost all down, with Japan’s Nikkei 225 off 2.58% and Europe’s Stoxx 600 down 0.49% by midmorning.
The mood among traders today is a stark reversal from yesterday, when the S&P 500 rose 1.56% after investors realized that Trump and China President Xi Jinping will likely meet at the upcoming APEC conference at the end of October—an opportunity for both men to reach one of Trump’s famous deals.
Pantheon Macroeconomics noted that consumer sentiment remains low: The University of Michigan’s consumer survey, which asks whether buyers feel now is a good time to make a major purchase, “now points to year-over-year growth in this measure of core spending slowing to near-zero soon, a far cry from the 6% pace earlier this year,” according to Samuel Tombs and Oliver Allen.
Goldman Sachs added to the gloom by publishing a note this morning titled “Jobless growth.” “The modest job growth alongside robust GDP growth seen recently is likely to be normal to some degree in the years ahead. We expect the great majority of U.S. potential GDP growth to come from solid productivity growth boosted by advances in artificial intelligence (AI), with only a modest contribution from labor supply growth due to population aging and lower immigration,” authors Pierfrancesco Mei and David Mericle said.
In the longer term, however, most analysts continue to see stocks going up, driven largely by the tech and AI sector.
Here’s a snapshot of the markets ahead of the opening bell in New York this morning: