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Investing.com — U.S, stock markets started the holiday-shortened week on a subdued note, as a high-profile downgrade of U.S. growth forecasts weighed on sentiment amid a broad lack of any more concrete news.
By 9:40 AM ET (1340 GMT), the Dow Jones Industrial Average was down 173 points, or 0.5% at 35,195 points, while the S&P 500 was down by 0.2% and the Nasdaq Composite was up by 0.1%, as investors once again sought relative safety in longer-dated growth plays.
Earlier. Goldman Sachs (NYSE:GS) cut its growth forecasts for gross domestic product in the fourth quarter to 5.5% from 6.5% earlier, a move that followed hard on the heels of its second downgrade to the outlook for the current quarter in as many weeks. Having originally expected the U.S. economy to expand at an annualized rate of 8.5% through the summer quarter, Goldman now sees growth of only 3.5%, thanks to the spread of Delta variant Covid-19 and the fading effect of fiscal stimulus.
The downgrade came after August’s labor market report showed a much bigger-than-expected hit to hiring from the latest wave of the pandemic. The U.S. economy created only 235,000 net nonfarm jobs through the middle of the month, less than a quarter of July’s gains and well below the 750,000 expected.
