This is an edition of the Markets P.M. newsletter, a recap of the day's most important markets moves, delivered after the closing bell. If you're not subscribed, sign up here.
What Happened in Markets Today
The U.S. job market is hot. A new labor-market report showed the U.S. added 162,000 jobs in August, about triple the amount economists expected. The unemployment rate remained at a healthy 4.1%, suggesting the job market is strong even if workers' pay isn't keeping up with inflation.
Stocks fell. A healthier labor market could give the Fed more comfort to raise interest rates at its meeting in two weeks, putting pressure on stock prices. The market-implied likelihood of a rate increase rose from about 49% Thursday to 58% Friday afternoon. The S&P 500 fell 0.4%, the Nasdaq shed 0.3%, and the Dow Jones Industrial Average lost 271.9 points, or 0.5%.
Trump called for lower rates. Despite the strong jobs report, President Trump threatened to cut off trade with countries with which the U.S. has a trade deficit if the Fed doesn't lower prevailing interest rates-a move the Fed isn't contemplating. The pronouncement had little impact on forecasts for the Fed's decision.
Volkswagen rose. The German automaker's board approved a doubling of workforce cuts to 100,000 in a sweeping reorganization plan. Volkswagen plans to halve the number of models it offers as part of the plan, which responds to rising competition from Chinese automakers and tariffs that have hurt its U.S. business. Its shares rose 6.5%.
Markets at a Glance
One Big Story
It is a well-trodden path: China's brightest minds come to the U.S., study and graduate there, and stay to found startups, work at big tech companies or continue in academia.
That's not the path Yang Zhilin chose.
Against the advice of his Ph.D. advisor at Carnegie Mellon University, Zhilin returned to China.
That move is starting to pay off. Zhilin co-founded Moonshot AI, which has become a top AI lab in China and recently wowed the world with the capabilities of its Kimi K3 model. Moonshot's most recent fundraising round valued it at $50 billion, and it's preparing to IPO on the Hong Kong exchange.
🎥 Heard on the Street's Quick Take
Government bond prices have been falling and yields rising to multi-decade highs in countries including Japan, the U.K. and Germany. Heard on the Street's Asa Fitch explains why.
What's Coming Up
A new gauge of optimism in U.S. small businesses for August is due on Tuesday morning.
New consumer credit data are also due Tuesday.
Next week is a slow one for corporate earnings, highlighted by database and AI computing company Oracle on Thursday.
Be prepared for the trading day ahead-sign up for Markets A.M.
About Us
Markets P.M. catches you up on the day's most important markets moves, delivered after the closing bell. This email was written by Asa Fitch, a writer for Heard on the Street, The Wall Street Journal's home for financial analysis and commentary. To send us your feedback, reply to this email. Got a tip for us? Here's how to submit.
