[U.S. Market Recap] Sept. 4: Dow Falls 271 Points as Tesla Drops 6% and Lululemon Plunges 20% on Hot Jobs Report

Hey everyone, Hirokichi here.

This time I’m covering Friday, September 4, in the U.S. stock market. Since today (Monday) is Labor Day in the U.S. and markets are closed, this recap covers Friday’s session plus the weekend’s key developments. The short version: August’s jobs report came in far stronger than expected, reviving talk of a Fed rate hike instead of a cut, and the Dow, S&P 500, and Nasdaq all pulled back together. On the stock side, Tesla fell 6% after an underwhelming robotaxi reveal, and Lululemon plunged more than 20% on disappointing earnings.

The Three Indexes: A Broad Pullback as Rate-Hike Bets Return

All three major indexes closed lower heading into the weekend. What stands out in this table is that the declines were modest but consistent across all three benchmarks — a sign this was a macro-driven pullback tied to interest-rate expectations, not a story about any single stock or sector.

The trigger was August’s U.S. jobs report. Nonfarm payrolls rose by 162,000, decisively beating the consensus estimate of 55,000, while the unemployment rate held steady at 4.1%. It might sound odd that good economic news pushed stocks lower, but the logic is straightforward: a strong labor market gives the Fed (the Federal Reserve, the U.S. central bank) more room to raise rates rather than cut them. The 10-year Treasury yield climbed to roughly 4.76%-4.78%, and rate-sensitive tech and growth stocks bore the brunt of the selling.

Fed funds futures briefly priced in around a 58%-60% chance of a rate hike at the September 15-16 FOMC (Federal Open Market Committee, the Fed’s policy meeting) meeting. After a few years in which rate cuts dominated the conversation, a return of hike talk clearly put investors on edge.

What Moved the Market: Payrolls Triple the Forecast

The single biggest driver on Friday was the August jobs report. Against a consensus forecast of 55,000 new jobs, the actual number came in at 162,000 — nearly three times as high — with upward revisions to both June and July figures. That confirms a labor market that remains resilient.

In my view, “good news that sends stocks down” is one of the trickiest concepts for newer investors to wrap their heads around. Strong growth is normally good for corporate earnings, but higher rates increase the discount rate used to value future profits, which tends to hit growth stocks especially hard. Friday’s drop fits that classic pattern: strong data, higher rates, headwind for stocks.

Stocks in the Spotlight: Tesla, Lululemon, Apple, and Broadcom

This table shows just how differently the market can react to earnings and announcements depending on the company. Let’s dig into each one.

Tesla (TSLA): Robotaxi Reveal “Underwhelms,” Stock Falls 6%

Tesla had gained 5.4% on Thursday but reversed sharply, falling 6% on Friday. The company held an event in Austin, Texas, for its Cybercab robotaxi, but it was invite-only, wasn’t livestreamed, and CEO Elon Musk didn’t appear. The update amounted to little more than confirming driverless rides within a geofenced area of Austin. Why did this matter so much? Investors have been watching closely to see whether Tesla can compete with Alphabet’s Waymo in the robotaxi space, so expectations going in were high. Why the sharp drop? Several analysts, including Wells Fargo, called the event “underwhelming” and flagged early execution issues, and reports emerged that U.S. regulator NHTSA had opened a safety inquiry into the Cybercab. Wells Fargo maintained a “Sell” rating with a $130 price target — a notably bearish call relative to where the stock trades today.

Lululemon (LULU): Earnings Disappoint, Stock Plunges Over 20%

Athletic-apparel maker Lululemon tumbled 20.4% after its latest earnings report. Why did this get attention? Quarterly revenue missed Wall Street’s forecasts and comparable-store sales (sales at existing stores versus a year earlier) deteriorated. Why such a sharp drop? Management cut its full-year guidance on top of the miss. A 20% single-day move on one earnings report is a large reaction, and it shows just how far the actual results fell short of what the market had priced in.

Apple (AAPL): Stock Falls 2.5% on Production-Delay Report

Apple shares fell roughly 2.5%. The catalyst was a report that a foldable iPhone reportedly in development was facing production issues, coming just ahead of Apple’s September 9 product event. This also landed just after a leadership transition — John Ternus became CEO on September 1, with Tim Cook moving into a chairman role — adding to investor unease around both the new leadership and a marquee upcoming product.

Broadcom (AVGO): Strong Earnings, Barely-There Stock Reaction

Semiconductor giant Broadcom reported very strong results, with AI (artificial intelligence) chip revenue up 221% year-over-year to $16.7 billion, and guided for AI chip revenue to rise 236% to $21.7 billion next quarter. Despite that, the stock barely moved, closing up just 0.21%. There’s no single clear explanation for the muted reaction, but market commentary points to next-quarter revenue guidance coming in slightly below some analyst estimates, along with the stock already trading at a valuation that priced in a lot of good news — a classic “sell the news” pattern even after a blowout quarter.

Sectors and ETFs: Only Tech, Industrials, and Utilities Advanced

Only three S&P 500 sectors advanced on Friday: Technology (+0.44%), Industrials (+0.22%), and Utilities (+0.12%). Among individual gainers, Caterpillar (+1.65%), Honeywell (+0.95%), and Home Depot (+0.88%) led the way. Comparing the day’s four spotlight stocks, Lululemon’s steep decline stands out, while Broadcom’s move was essentially flat by comparison.

For ETFs popular with Japanese retail investors: S&P 500-tracking funds like VOO and VTI, and the Nasdaq-100-tracking QQQ, likely moved roughly in line with their underlying indexes. High-dividend ETFs such as SPYD, HDV, and VYM tend to hold up relatively well when rates are rising, but I wasn’t able to confirm their exact Friday moves, so I’ll leave that point open rather than guess.

In currencies and commodities, the dollar briefly touched the 156 yen level before the yen strengthened back to around 155.3, helped by expectations of further BOJ rate hikes and comments from U.S. Treasury Secretary Bessent pushing back on yen weakness. WTI crude rose on concerns about a potential blockade of the Strait of Hormuz amid Middle East tensions, and gold climbed to around $4,472 per troy ounce. The VIX (a gauge of market fear/volatility) stayed in the low-14s, still a relatively calm reading.

What to Watch Today: Post-Labor Day, Waiting on CPI

Today, September 7, is Labor Day in the U.S., so markets are closed and Japanese stocks are starting the week without a direct read from Wall Street. Here are three things I’m watching this week: (1) The August Producer Price Index (PPI) lands September 10, followed by the Consumer Price Index (CPI) on September 11. If inflation data also comes in hot after the jobs report, rate-hike expectations for September could firm up further. (2) The European Central Bank (ECB) holds its policy meeting September 9-10, which should also move currency and global equity markets. (3) Watch whether the yen’s move back toward 155.3 stalls or extends further on BOJ rate-hike expectations — a stronger yen tends to be a headwind for Japan’s export-heavy stocks.

For more on the bigger investing picture, check out the full record of my net-worth updates here — it’s a good way to see how all of this fits into a longer-term plan.

Let’s keep at it, slow and steady. Have a good day!

日本語版はこちら → 米国株まとめ（日本語版）

* This article is for informational purposes only and does not recommend any specific investment. Please make investment decisions at your own responsibility.

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