The U.S. unemployment rate rose to 4.3% in July and hiring slowed, adding to signs of a broader downturn in what has been a solid U.S. economy.

The Bureau of Labor Statistics reported Friday that the U.S. added 114,000 jobs, down from 206,000 in June and well short of expectations. Economists were expecting the unemployment rate to have been unchanged from June’s 4.1% reading.

The latest report will likely add to worries from some economists that the Federal Reserve has waited too long to cut interest rates in its bid to stamp out inflation. Earlier this week, Fed Chair Jay Powell indicated the first rate cut of the post-pandemic period would come in September, even as many economists flagged signs of a rapidly cooling labor market.

Friday’s report adds further evidence to those concerns.

‘Oh dear, has the Fed made a policy mistake?’ wrote Seema Shah, chief global strategist at Principal Asset Management based in the UK, in a note to clients following the jobs report’s release. ‘The labour market’s slowdown is now materialising with more clarity.’

She noted job gains have now dropped below the 150,000 threshold ‘that would be considered consistent with a solid economy,’ and that a September rate cut ‘is in the bag.’

‘The Fed will be hoping that they haven’t, once again, been too slow to act,’ Shah said.

Beyond the report’s headline figures were mitigating factors and other signs that the economy remains on relatively firm footing.

Much of the increase in the unemployment measure was driven by temporary layoffs, while the BLS indicated that weather-related factors had temporarily increased the ranks of those who still hold jobs but were technically not at work during the month.  

Meanwhile, wage gains continued to outpace inflation — continuing a trend that has now taken hold for months — and more people rejoined the workforce last month, something reflected in an increased labor force participation rate.

Yet outside of health care, construction and some transportation and warehousing roles, there was little meaningful job growth, with manufacturing adding just 1,000 to its payrolls and professional and business services positions declining by 1,000.

‘Even a few months ago, the labor market seemed fine, the trajectory looked stable,’ said Guy Berger, director of economic research at the Burning Glass Institute, a think tank. ‘Today, things look a bit shakier.’

While Berger doesn’t see an imminent recession, it wouldn’t take much for the gradual downturn to become a more significant one, he said.

The Federal Reserve doesn’t envision that outcome — and in fact is largely in control of it, economists say.

On Wednesday, the Fed announced that it was leaving its key interest rate unchanged at about 5.5% even as Powell said a cut at its next meeting was ‘on the table.’

By cutting interest rates, the central bank would reduce the cost of borrowing for goods and services, which would result in lower monthly payments for consumers and businesses alike who are subject to variable annual percentage rates.

In turn, demand and hiring are likely to increase throughout the economy.

On average, companies are hanging on to their current workers — something reflected in the rate of layoffs’ falling to a record low.

Yet the hiring rate has also fallen to a level not seen since the onset of the pandemic — and before that, 2014.

The upshot: If you have a job, you’re unlikely to lose it these days, barring some exceptions.

But you’re going to struggle if you’re looking for a new one.

The Fed therefore believes it can put a floor underneath the labor market that prevents it from deteriorating further, Berger said.

While there is reason to believe it can accomplish that, there is an alternative view that it is already behind the curve and should have cut interest rates by now.

‘Historically, deteriorating labor markets generate a self-reinforcing feedback loop,’ former New York Federal Reserve President Bill Dudley wrote in a Bloomberg News op-ed last week. ‘When jobs are harder to find, households trim spending, the economy weakens and businesses reduce investment, which leads to layoffs and further spending cuts.’ 

Another worrying sign: The job growth that is occurring has been in an exceptionally narrow range of occupations, like health care and, to a lesser extent, government, particularly at the state and local levels.

From 2015 to 2019, the average monthly pace of payrolls growth outside of those industries was about 137,000, said Julia Pollak, chief economist at ZipRecruiter.

For the past six months, it has averaged 90,000, Pollak said.

And for the past three months, it has averaged just 58,000.

‘What we need to see is strong private-sector labor market growth, and outside of health care, what we’ve seen instead is a very, very rapid deceleration that has shown no signs yet of stabilizing,’ Pollak said.

The result has been an economy of haves and have-nots, she said.

‘The demand for labor has softened substantially; [high] interest rates are having a real effect,’ Pollak said. ‘They are causing businesses to forgo growth opportunities, something that’s causing consumers, especially low-end consumers, to pull back. We’re seeing a bifurcation in consumer behavior.’

Pollak also said leisure and hospitality jobs — a key entry point into the labor market — have actually declined outright in recent months, putting further pressure on workers to secure employment.

Berger said the best outcome is that there won’t be further deterioration. Sluggish growth, he said, is likely to continue for the foreseeable future.

‘I think the Fed is going to keep a lid on how much things heat up — it probably has a soft ceiling on how high it wants to go,’ he said.

‘So we’re going to be stuck in this period for quite a while, where the environment for someone looking for a job is just not great. Things could always get a lot worse, but if you’re hoping for things to turn around, I don’t think the prospect of a big rapid rebound is feasible. It’s going to be gradual and going to take time.’

Delta Air Lines CEO Ed Bastian on Friday offered employees two free travel passes to thank staff members who were caught in massive disruptions last month sparked by a botched CrowdStrike software update that stranded thousands of customers and crew.

Delta had more trouble than competitors in recovering from the outages that took thousands of Windows machines offline. The carrier canceled more than 5,000 flights from July 19 through July 24, more than it did in all of 2019, according to FlightAware, in an incident that CEO Bastian said earlier this week cost the company about $500 million, a sum that is equal to about 40% of Delta’s second-quarter profit.

The disruption “has been a humbling moment for our company,” Bastian said in his note on Friday, which was seen by CNBC. “I know it’s been extremely difficult, and I’m deeply sorry for what you have endured. An operational disruption of this length and magnitude is simply unacceptable — you and our customers deserve better.”

The flight cancellations and delays stranded thousands and scarred Delta’s reputation as a standout in reliability. Its executives frequently point out Delta’s work to win over customers willing to pay more to fly the carrier, marketing itself as a premium airline.

Bastian said Delta plans to pursue legal action against CrowdStrike and Microsoft “to recover our losses caused by the outage” and that it has hired law firm Boies Schiller Flexner.

“Your efforts throughout have been nothing short of heroic,” he told staff.

Microsoft and CrowdStrike didn’t immediately comment on Friday.

Stocks tumbled for the second-straight day Friday as a weaker-than-expected jobs report and a dismal forecast from Amazon added to investor fears of a more substantial slowdown for the U.S. economy.

The Dow Jones Industrial Average closed down 611 points, or 1.5%. The S&P 500 dropped 1.8%, while the Nasdaq Composite lost 2.4%.

Early Friday, the Bureau of Labor Statistics reported that the U.S. added just 114,000 jobs in July — well below the 185,000 expected and down significantly from 206,000 in June.

Meanwhile, the unemployment rate climbed to 4.3%, from 4.1% — its fourth-straight monthly increase and its highest level since October 2021.

The market was already primed for losses as it opened following a negative quarterly earnings report from Amazon late Thursday. The e-commerce giant said customers were ‘continuing to be cautious in their spending’ amid a thinner financial cushion and the continued impact of higher prices.

The bad data kept rolling in as Friday wore on: The Commerce Department’s Census Bureau reported factory orders fell 3.3% in June, the biggest decline since April 2020 at the outset of the pandemic.

Friday’s sell-off pushed the Nasdaq index, which represents tech stocks, into correction territory, meaning it is now down more than 10% from an all-time high, set just a month ago.

Leading Friday’s pullback in stocks was Intel, which cratered 26% after announcing weak guidance and layoffs. Other big names seeing large declines included Prudential financial group, down 10% Booking.com, down 9%. Amazon also fell 9%.

In response to the ugly economic news, traders bought up U.S. Treasuries, which are seen as a safe-haven asset. That pushed the yield on the 10-year note down to about 3.79%, its lowest level since December 2023.

While the lower yield reflects economic distress, it was somewhat of a boon for homebuyers as mortgage rates, which track the 10-year yield, fell to 6.4%, their lowest level in more than a year.

Friday represented the market’s second-consecutive day of major declines. A day earlier, stocks saw heavy losses as they responded to other weaker-than-expected data, including a disappointing manufacturing output report and surprisingly high initial jobless claims.

Following Friday’s jobs report, many traders penciled in a 0.5% cut to the Federal Reserve’s key federal funds rate for the Fed’s next meeting in September.

The Fed usually acts in 0.25% increments — so by making a 0.5% cut, a growing chorus on Wall Street is betting that the Fed will be playing catch up by the time its Federal Open Market Committee (FOMC), which sets interest rates, meets again.

Earlier in the week, the FOMC announced it was keeping the fed funds rate at its current level of about 5.5% in order to continue to put pressure on inflation.

Claudia Sahm, a former Fed economist and the namesake of an economic rule that has predicted past recessions and which is now close to being triggered, said that while the new data are alarming, a true downturn is not yet inevitable.

“We are not in a recession now — contrary [to] the historical signal from the Sahm rule — but the momentum is in that direction,” Claudia Sahm, chief economist at New Century Advisors, said via email. “A recession is not inevitable and there is substantial scope to reduce interest rates.

Warren Buffett’s Berkshire Hathaway dumped nearly half of its gigantic Apple stake last quarter in a surprising move for the famously long-term-focused investor.

The Omaha-based conglomerate disclosed in its earnings filing that its holding in the iPhone maker was valued at $84.2 billion at the end of the second quarter, suggesting that the Oracle of Omaha offloaded a little more than 49% of the tech stake. Even after the selling Apple remains the largest stock stake by far for Berkshire.

The Apple share sale comes amid a broader pattern of selling by Buffett in the second quarter as Berkshire unloaded more than $75 billion in equities in the period, raising the conglomerate’s cash fortress to a record $277 billion.

Buffett had trimmed the Apple stake by 13% in the first quarter and hinted at the Berkshire annual meeting in May that it was for tax reasons. Buffett noted that selling “a little Apple” this year would benefit Berkshire shareholders in the long run if the tax on capital gains is raised down the road by a U.S. government wanting to plug a climbing fiscal deficit.

But the magnitude of this selling suggests it could be more than just a tax-saving move.

After declining in the first quarter on concerns it was falling behind on artificial intelligence innovation, Apple shares took off in the second quarter, gaining 23% to a new record as it gave more detail to investors about its future in artificial intelligence.

It won’t be clear exactly why Buffett is selling down the holding Berkshire first bought more than eight years ago, whether company reasons, market valuation or because of portfolio management concerns (Buffett typically doesn’t want a single holding to grow too large). Berkshire’s Apple holding was once so big that it took up half of its equity portfolio.

The 93-year-old investor largely avoided technology companies for most of his career before Apple. Berkshire began buying the stock in 2016 under the influence of Buffett’s investing lieutenants Ted Weschler and Todd Combs. Over the years, Buffett grew so fond of Apple that he increased the stake drastically to make it Berkshire’s biggest and called the tech giant the second-most important business after his cluster of insurers.

Buffett has been on a bit of a selling spree as of late with his top holdings. Buffett recently starting downsizing his second biggest stake — Bank of America, shedding $3.8 billion worth of the bank shares after a 12-day selling spree.

Overall, the quarterly report showed Buffett dumping stock last quarter, which saw the S&P 500 rise to a record in anticipation of a “soft landing” for the U.S. economy. That soft landing was called into question this week with Friday’s weaker-than-expected July jobs report.

The average rate on the popular 30-year fixed mortgage dropped 22 basis points to 6.4% Friday, according to Mortgage News Daily. That is the lowest rate since April 2023. The 15-year fixed rate fell to 5.89%, its lowest level since early May 2023.

The drop followed a weaker-than-expected monthly employment report, which sent bond yields falling fast. Mortgage rates loosely follow the yield on the 10-year U.S. Treasury.

“Between [Federal Reserve Chairman Jerome] Powell’s equivocal openness to “multiple cuts” in 2024 on Wednesday and this morning’s sharply weaker jobs report (something Powell didn’t even know about on Wednesday), the more aggressive rate cut narrative is quickly coming into focus,” wrote Matthew Graham, chief operating officer at Mortgage News Daily. 

There are still two inflation reports and another employment report before the Fed’s September meeting, Graham noted, adding, “If they don’t offer strong counterpoints to recent data, the rate cut cycle has not only begun, but it will likely involve a certain sense of urgency.”

The 30-year fixed rate started the week at 6.81%, so the drop in just the past five days is dramatic. The recent high was 7.52% in late April, and home sales have been falling ever since. Buyers were battling not just high interest rates but high home prices and a lack of supply. Supply has since improved, but prices are still overheated.

The difference in just a few months is stark when it comes to affordability. In April, a buyer looking to purchase a $400,000 home with a 20% down payment and a 30-year fixed mortgage would have been facing a monthly payment of about $2,240, not including insurance and property taxes. Today, that monthly payment would be about $2,000. More buyers would also qualify for the loan at today’s lower rates.

Mortgage applications to purchase a home have been running about 15% below where they were at this time last year, according to the Mortgage Bankers Association. This latest drop could kickstart demand.

“The market is moving ahead of the Fed, bringing down longer-term rates including those for mortgages, which should lead to both more home purchases and a pickup in refinance activity,” wrote Mike Fratantoni, chief economist for the Mortgage Bankers Association, in a news release.

U.S. stocks saw their third-straight trading day of heavy declines as recession fears continued to mount and Wall Street abandoned a popular trade that had helped counter high interest rates.

The Dow Jones Industrial Average was down roughly 900 points or nearly 2.5% Monday morning, while the S&P 500 declined 2.3% and the tech-focused Nasdaq fell 2.5%.

On Friday, the Bureau of Labor Statistics reported worse-than-expected jobs data, showing the U.S. unemployment rate had climbed to 4.3% and that the economy had added just 114,000 jobs.

That sparked fears that the Federal Reserve should already have cut interest rates by this point and would instead tip the economy into a recession.

The central bank has spent the past several years keeping those rates at levels last seen prior to the Great Recession in the hopes of tamping down inflation.

But some economic and financial data show the U.S. economy rapidly weakening as a consequence.

In addition to the jobs report, traders have been reacting to a weaker outlook from e-commerce giant Amazon, as well as a growing belief that much of the recent run-up in tech stocks, which pushed the Nasdaq to a record high just a month ago, has been overdone.

Among the companies seeing major declines in their share prices early Monday:

While macroeconomic forces weighed on markets, other commentators pointed out that much of the sell-off was also due to traders abandoning a popular strategy for countering the Fed’s higher interest rates.

As the U.S. central bank made borrowing more expensive stateside, the Bank of Japan had, until recently, kept its interest rates lower to increase investment in the yen. It did the trick: Wall Street began borrowing against the yen at the lower interest rates in order to invest more cheaply in desired assets.

Now, the trade has flipped: the BOJ has signaled it intends to increase interest rates, while Fed Chair Jerome Powell said a September rate is almost certainly in the offing.

The result is that the U.S. dollar has erased most of its gains on the year.

Meanwhile, investors are increasingly putting their money into U.S. Treasury bonds — deemed ‘haven’ assets that act as stores of wealth in volatile moments. 

The yield on the 10-year note hit as low as 3.68%, its lowest level since June 2023. While that’s a signal that recession fears are increasing, it could also bring relief to the housing market, since mortgage rates track the 10-year yield.

Cryptocurrencies including bitcoin and ethereum also saw sizable price declines. Bitcoin fell nearly 14% to about $50,000, its lowest level since this spring, while ethereum dropped 17% to about $2,200, effectively erasing its gains for the year.

CrowdStrike on Sunday said Delta Air Lines had rejected on-site help during last month’s massive outage that sparked thousands of flight cancellations.

Delta CEO Ed Bastian told CNBC’s “Squawk Box” last week that the mass cancellations following the outage, which occurred at one of the busiest times of the year, cost the company about $500 million, including customer compensation. The airline has “no choice” but to seek damages, he said.

Bastian told staff on Friday that the airline had informed CrowdStrike and Microsoft that the company was “planning to pursue legal claims” to recover its losses stemming from the outage and that it had hired law firm Boies Schiller Flexner.

In response, Michael Carlinsky, CrowdStrike’s lawyer and co-managing partner at Quinn Emanuel Urquhart & Sullivan, wrote to Delta’s lawyer David Boies on Sunday that Delta’s litigation threats “contributed to a misleading narrative that CrowdStrike is responsible for Delta’s IT decisions and response to the outage.”

He said CrowdStrike CEO George Kurtz reached out to Bastian to “offer onsite assistance, but received no response.”

Delta canceled more than 5,000 flights between the July 19 outage, caused by a botched software update, through July 25, more than its rivals.

CrowdStrike shares have lost more than 36% of their value since the outages affected millions of computers running the company’s software atop Microsoft’s Windows operating system. The outage hit industries from banking to health care to air travel.

“Should Delta pursue this path, Delta will have to explain to the public, its shareholders, and ultimately a jury why CrowdStrike took responsibility for its actions—swiftly, transparently, and constructively—while Delta did not,” Carlinsky’s letter said.

He said Delta would have to preserve a series of documents, including those describing its information-technology infrastructure, IT business continuity plans and its handling of outages over the past five years.

CrowdStrike’s contractual liability is capped in the single-digit millions, the letter said. Delta did not comment on the letter on Sunday night. In a separate statement, CrowdStrike said it hopes “Delta will agree to work cooperatively to find a resolution.”

“We did everything we could to take care of our customers over that time frame,” Bastian said in an interview Wednesday on CNBC’s “Squawk Box.” “If you’re going to be having access, priority access, to the Delta ecosystem in terms of technology, you’ve got to test this stuff. You can’t come into a mission critical 24/7 operation and tell us we have a bug. It doesn’t work.”

CrowdStrike vowed to release future software updates in stages in a preliminary post-incident report.

On July 30, CrowdStrike shareholders filed a suit against the company in a Texas federal court and sought damages for declines in their investments.

CrowdStrike reports fiscal second-quarter results Aug. 28.

A Microsoft spokesperson did not immediately respond to CNBC’s request for comment.

ROCKLAND, Maine — Noah Barnes can’t sell bunks aboard his schooner fast enough. The ones unoccupied by his staff, anyway.

Barnes, the owner and captain of the 153-year-old Stephen Taber, said demand for multiday voyages off Rockland has been “as good as the Clinton years.”

“Typically in election years and times of uncertainty, we see a little bit of a dip” as people hesitate to plan vacations, he said in late June as the turbulent presidential race ramped up. “We haven’t seen any of that.”