Stock market today: Dow drops 600 on weak jobs data as a global sell-off whips back to Wall Street

NEW YORK (AP) — Stocks tumbled Friday on worries the U.S. economy could be cracking under the weight of high interest rates meant to whip inflation. The S&P 500 fell 1.8% Friday for its first back-to-back loss of at least 1% since April. The Dow Jones Industrial Average lost 1.5%, and the Nasdaq composite fell 2.4%. A report showing hiring by U.S. employers slowed last month by much more than expected sent fear through markets. Intel sank to its worst day in 50 years after reporting weaker-than-expected profits and suspending its dividend. Treasury yields tumbled as expectations built for how deeply the Federal Reserve will cut rates in September.

THIS IS A BREAKING NEWS UPDATE. AP’s earlier story follows below.

NEW YORK (AP) — Stocks are tumbling Friday on worries the U.S. economy could be cracking under the weight of high interest rates meant to whip inflation.

The S&P 500 was sinking by 2.1% in afternoon trading. The Dow Jones Industrial Average was down 775 points, or 1.9%, with a little more than an hour remaining in trading, and the Nasdaq composite was 2.6% lower as a sell-off for stocks whipped all the way around the world back to Wall Street.

A report showing hiring by U.S. employers slowed last month by much more than economists expected sent fear through markets, with both stocks and bond yields dropping sharply. It followed a batch of weaker-than-expected reports on the economy from a day earlier, including a worsening for U.S. manufacturing activity, which has been one of the areas hurt most by high rates.

It was just a couple days ago that U.S. stock indexes jumped to their best day in months after Federal Reserve Chair Jerome Powell gave the clearest indication yet that inflation has slowed enough for cuts to rates to begin in September.

Now, worries are rising the Fed may have kept its main interest rate at a two-decade high for too long. A rate cut would make it easier for U.S. households and companies to borrow money and boost the economy, but it could take months to a year for the full effects to filter through.

“The Fed is seizing defeat from the jaws of victory,” said Brian Jacobsen, chief economist at Annex Wealth Management. “Economic momentum has slowed so much that a rate cut in September will be too little and too late. They’ll have to do something bigger than” the traditional cut of a quarter of a percentage point ”to avert a recession.”

Traders are now betting on a nearly three-in-four chance that the Fed will cut its main interest rate by half a percentage point in September, according to data from CME Group. That's even though Powell said Wednesday that such a deep reduction is “not something we're thinking about right now.”

Of course, the U.S. economy is still growing, and a recession is far from a certainty. The Fed has been clear about the tightrope it's walking since it started hiking rates sharply in March 2022: Being too aggressive would choke the economy, but going too soft would give inflation more oxygen and hurt everyone.

While refusing to claim victory on either the jobs or the inflation fronts on Wednesday, before the discouraging economic reports hit, Powell said Fed officials “have a lot of room to respond if we were to see weakness” in the job market after hiking its main rate so high.

“Certainly today’s job data feeds the weakening economy narrative, but I believe the market is overreacting at this point and pricing too much in on rate cuts at this stage,” said Nate Thooft, senior portfolio manager at Manulife Investment Management. “Yes, the economy is weakening, but I am not convinced there is enough evidence that the data so far is a death knell for the economy.”

U.S. stocks had already appeared to be headed for losses Friday before the disappointing jobs report thudded onto Wall Street.

Several big technology companies turned in underwhelming profit reports, which continued a mostly dispiriting run that began last week with results from Tesla and Alphabet.

Amazon fell 9.2% after reporting weaker revenue for the latest quarter than expected. The retail and tech giant also gave a forecast for operating profit for the summer that fell short of analysts’ expectations.

Intel dropped even more, 26.7% and on pace for its worst day in 50 years, after the chip company’s profit for the latest quarter fell well short of forecasts. It also suspended its dividend payment and said it expects to lose money in the third quarter, when analysts were expecting a profit.

Apple was holding steadier, up 2.2%, after reporting better profit and revenue than expected.

Apple and a handful of other Big Tech stocks known as the “ Magnificent Seven ” have been the main reasons the S&P 500 has set dozens of records this year, in part on a frenzy around artificial-intelligence technology. But their momentum turned last month on worries investors had taken their prices too high and expectations for future growth are too difficult to meet.

Friday's losses for tech stocks dragged the Nasdaq composite down by more than 10% from its record set in the middle of last month.

Helpfully for Wall Street, other areas of the stock market beaten down by high interest rates had been rebounding last month when tech stocks were regressing, particularly smaller companies. But they tumbled too Friday on worries that a fragile economy could undercut their profits.

The Russell 2000 index of smaller stocks dropped 3.6%, more than the rest of the market.

In the bond market, Treasury yields fell sharply as traders raised their expectations for how deeply the Federal Reserve would have to cut interest rates. The yield on the 10-year Treasury fell to 3.79% from 3.98% late Thursday and from 4.70% in April.

In stock markets abroad, Japan’s Nikkei 225 dropped 5.8%. It's been struggling since the Bank of Japan raised its benchmark interest rate on Wednesday. The hike pushed the value of the Japanese yen higher against the U.S. dollar, potentially hurting profits for exporters and deflating a boom in tourism.

Chinese stocks fell week as investors registered disappointment with the government’s latest efforts to spur growth through various piecemeal measures, instead of hoped-for infusions of broader stimulus, while stock indexes dropped by more than 1% across much of Europe.

Commodity prices have also had a rough ride this week. Oil prices surged after the killings of leaders of Hamas and Hezbollah that fueled fears that a widening conflict in the Middle East could disrupt the flow of crude.

But prices fell back Thursday and Friday on worries that a weakening economy will burn less fuel. A barrel of benchmark U.S. crude tumbled back below $74 Friday after coming into the week above $77.

AP Business Writers Matt Ott and Elaine Kurtenbach contributed.

A trio of traders work on the floor of the New York Stock Exchange, Friday, Aug. 2, 2024. (AP Photo/Richard Drew)

Traders gather at the post of specialist Stephen Naughton, right,on the floor of the New York Stock Exchange, Friday, Aug. 2, 2024. (AP Photo/Richard Drew)

Trader John Romolo works on the floor of the New York Stock Exchange, Friday, Aug. 2, 2024. (AP Photo/Richard Drew)

Specialist James Denaro works at his post on the floor of the New York Stock Exchange, Friday, Aug. 2, 2024. (AP Photo/Richard Drew)

FILE - People pass the New York Stock Exchange on July 31, 2024 in New York. World shares have tumbled on Friday, August 2, 2024, with Japan's Nikkei 225 index slumping 5.8% as investors panicked over signs of weakness in the U.S. economy.(AP Photo/Peter Morgan, File)

A person walks in front of an electronic stock board showing Japan's Nikkei 225 index Friday, Aug. 2, 2024, in Tokyo. Shares in Europe and Asia tumbled Friday, with Japan’s Nikkei 225 index slumping 5.8% as investors panicked over signs of weakness in the U.S. economy. (Kyodo News via AP)

A person walks in front of an electronic stock board showing Japan's Nikkei 225 index Friday, Aug. 2, 2024, in Tokyo. Shares in Europe and Asia tumbled Friday, with Japan’s Nikkei 225 index slumping 5.8% as investors panicked over signs of weakness in the U.S. economy. (Kyodo News via AP)

A currency trader passes by the screen showing the Korea Composite Stock Price Index (KOSPI) at the foreign exchange dealing room of the KEB Hana Bank headquarters in Seoul, South Korea, Friday, Aug. 2, 2024. (AP Photo/Ahn Young-joon)

Currency traders watch monitors near the screen showing the Korea Composite Stock Price Index (KOSPI), top left, and the foreign exchange rate between U.S. dollar and South Korean won, top center, at the foreign exchange dealing room of the KEB Hana Bank headquarters in Seoul, South Korea, Friday, Aug. 2, 2024. (AP Photo/Ahn Young-joon)

An electronic stock board shows that Nikkei stock average dropped over 1,900 Japanese yen from previous day, in Tokyo Friday, Aug. 2, 2024. (Kyodo News via AP)

A currency trader watches monitors near the screen showing the Korea Composite Stock Price Index (KOSPI), left, and the foreign exchange rate between U.S. dollar and South Korean won at the foreign exchange dealing room of the KEB Hana Bank headquarters in Seoul, South Korea, Friday, Aug. 2, 2024. (AP Photo/Ahn Young-joon)

People pass by an electronic stock board in Tokyo Friday, Aug. 2, 2024. (Kyodo News via AP)

ARLINGTON, Texas (AP) — Elmer Rodriguez got his first big league strikeout on what became a strange double play and the right-hander escaped the first bases-loaded jam in his debut for the New York Yankees on Wednesday.

The 22-year-old, among the Yankees' top prospects, pitched into the fifth inning of their 3-0 loss to Texas. The Rangers loaded the bases with no outs in the fifth before Josh Jung hit a two-run single that chased him after 80 pitches.

“Obviously, not the result that we wanted, but I went out there and competed and felt great,” Rodriguez said.

“A lot of good out there, we saw his stuff plays,” manager Aaron Boone said. “Just a little better on the strike-throwing part and, you know, it’s a different line. But still kept us in the game, gave us a chance.”

Rodriguez walked four, hit a batter and struck out three while throwing 42 of his 80 pitches for strikes. He allowed four hits and two runs.

Rodriguez took right-hander Luis Gil’s spot in the rotation after the 2024 AL Rookie of the Year was optioned to Triple-A following a 7-4 loss to the Astros on Sunday. That is a tweak at the back end of the rotation while Carlos Rodón and Gerrit Cole rehab from injuries.

Even though he threw balls on 11 of his first 18 pitches, Rodriguez got out of his first big league inning without giving up a run, getting help from that double play.

“I was kind of confused at the moment. I didn’t know what was going on,” he said. “But thankfully, I got the strikeout and got the double play.”

Jung signaled for a challenge of a 96.5 mph sinker on a called third strike while Brandon Nimmo, who led off with a walk on five pitches, was thrown out at second on an attempted stolen base. But there was a pause, the ABS review and a conversation among all four umpires before both outs were confirmed.

The Rangers failed to score again in the second after loading the bases when their Nos. 7-9 batters reached with two outs — on two singles and a walk — before Nimmo’s inning-ending flyout to center.

After 1-2-3 innings in both the third and fourth innings, Rodriguez opened the fifth by hitting a batter and walking another before Nimmo's infield single on a hard short-hopper not handled by first baseman Ben Rice. Jung grounded a ball through the left side of the infield for a 2-0 lead.

“Obviously, strike-throwing wasn’t as sharp as it’s going be with him and typically is,” Boone said. “At the end of the day, threw up four zeros and then got himself into a little bit of trouble there in the fifth.”

Rodriguez became only the fourth pitcher born in Puerto Rico to start a game for the Yankees, the first since Javier Vázquez in 2010. Rodriguez pitched for his home country in the World Baseball Classic last month.

“It was great. It’s something I’ve been dreaming of my whole life and just being out there, seeing the crowd, seeing the field, it was something special,” Rodriguez said of his big league debut.

The only other starting pitchers age 22 or younger to make their big league debuts for the Yankees since 2008 were Deivi García at age 21 on Aug. 30, 2020, and 21-year-old Luis Severino on Aug. 5, 2015.

In four starts at Triple-A Scranton/Wilkes-Barre before getting called up, Rodriguez was 1-2 with a 1.27 ERA. He had 20 strikeouts and seven walks in 21 1/3 innings.

Drafted by Boston in 2021, he was sent the Yankees in December 2024 for catcher Carlos Narvaez.

Even before the game, Boone had said Rodriguez had earned his way to the majors and was ready for it.

“He’s got the stuff," Boone said then. “I think this is a kid that is going to have a long career as a starting pitcher in this league.”

AP MLB: https://apnews.com/hub/mlb

New York Yankees starting pitcher Elmer Rodriguez throws to the Texas Rangers in the second inning of a baseball game Wednesday, April 29, 2026, in Arlington, Texas. (AP Photo/Tony Gutierrez)

New York Yankees starting pitcher Elmer Rodriguez stands in the dugout after being pulled in the fifth inning of a baseball game against the Texas Rangers Wednesday, April 29, 2026, in Arlington, Texas. (AP Photo/Tony Gutierrez)

New York Yankees starting pitcher Elmer Rodriguez, right front, walks to the dugout after turning the ball over to manager Aaron Boone, center left, as José Caballero (72), Ben Rice, left rear, and J.C. Escarra, right rear, stand on the mound in the fifth inning of a baseball game against the Texas Rangers Wednesday, April 29, 2026, in Arlington, Texas. (AP Photo/Tony Gutierrez)

New York Yankees starting pitcher Elmer Rodriguez makes his major league debut as he throws to the Texas Rangers in the first inning of a baseball game Wednesday, April 29, 2026, in Arlington, Texas. (AP Photo/Tony Gutierrez)