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Barrett, Huron, WEBTOON, and Magnite Stocks Trade Down, What You Need To Know

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What Happened?

A number of stocks fell in the morning session after a surprisingly weak U.S. jobs report was released, fueling concerns about a slowing economy. 

The U.S. economy added only 73,000 jobs, falling significantly short of economists' expectations, while figures for May and June were revised down, erasing 258,000 previously reported jobs. The professional and business services industry itself shed 14,000 jobs. This data points to a cooling labor market, fueling concerns of a slowing economy. A weaker economic outlook often leads to reduced corporate spending on key services like IT consulting and professional staffing, which directly impacts the sector's revenue and growth prospects. The report immediately increased investor expectations of an interest rate cut by the Federal Reserve.

The stock market overreacts to news, and big price drops can present good opportunities to buy high-quality stocks.

Among others, the following stocks were impacted:

Zooming In On WEBTOON (WBTN)

WEBTOON’s shares are extremely volatile and have had 40 moves greater than 5% over the last year. In that context, today’s move indicates the market considers this news meaningful but not something that would fundamentally change its perception of the business.

The previous big move we wrote about was 9 days ago when the stock gained 5.3% on the news that a new trade agreement between the United States and Japan spurred a broad market rally. The positive sentiment swept across markets after it was announced the U.S. and Japan had reached a new trade deal. The agreement included a 15% tariff on Japanese goods imported into the U.S. and a commitment from Japan to invest $550 billion in the U.S. and open its markets to American cars and agricultural products. This development boosted investor confidence and contributed to a widespread rally, lifting stocks across many sectors. The Dow Jones Industrial Average and the S&P 500 both posted gains, creating a favorable environment that likely benefited individual stocks.

WEBTOON is down 31.5% since the beginning of the year, and at $9.32 per share, it is trading 55.6% below its 52-week high of $21 from August 2024. Investors who bought $1,000 worth of WEBTOON’s shares at the IPO in June 2024 would now be looking at an investment worth $405.

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