President Joe Biden said the stock market is not reflective of the state of the economy in comments made after casting his vote at a local polling station in Delaware.
What Happened: Biden said, “The stock market doesn’t necessarily reflect the state of the economy, as you well know. And the economy is still strong. Unemployment is low. Jobs are up. Manufacturing is good,” according to The White House.
When the president was asked whether he was worried about the inflation numbers he said, “No, I’m not, because we’re talking about one-tenth of 1%.”
Why It Matters: Data released by the U.S. Bureau of Labor Statistics on Tuesday indicates that the headline consumer price index rose 8.3% in August, down from 8.5% in July, above market estimates.
Stocks plunged the most since June 2020, with the S&P 500 and Nasdaq ending Tuesday lower by 4.3% and 5.2%, respectively. At the time of writing, U.S. stock futures rose marginally and were in the green.
As for unemployment, 315,000 jobs were added in August, higher than the estimated 300,000, although it was within the predicted range.
Trading Economics data indicates that the S&P Global US Manufacturing PMI was revised higher to 51.5 in August from a preliminary number of 51.3 — this indicates factory activity grew at its slowest since July 2020.
SPDR S&P 500 ETF Trust SPY closed 4.3% lower at $393.10. Among the biggest stocks, in terms of market valuation, Amazon.com, Inc AMZN, Apple Inc AAPL and Tesla Inc AMZN dropped 7.1%, 5.9%, and 4%, respectively.
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