Unemployment Data Rattle Wall Street

Updated from 9:08 a.m. EDT

After a brutal session the day before, stocks in New York continued to dig a hole at Friday's open as the government's read on unemployment jumped for August, renewing investor concerns about a U.S. recession.

The Dow Jones Industrial Average tumbled 68 points to 11,120, and the S&P 500 gave back 9.1 points to 1228. The Nasdaq was down 17 points at 2242.

On Thursday, the major indices swooned, each losing at least 3% as several data reports indicated the economy remains weak. A decline in commodity prices over the past week wasn't offering much relief from the gloom, and sellers dramatically outnumbered buyers on both the New York Stock Exchange and the Nasdaq.

Ahead of the new session the Labor Department reported that the August unemployment rate reached 6.1%, its highest level since September 2003. Economists had been expecting that the rate would hold at July's level of 5.7%. Nonfarm payrolls were down by 84,000, a bigger loss than 75,000 in July. The average workweek remained unchanged at 33.6 hours, and the average hourly wage rose 0.4% from a month ago to $18.14.

In company news, bond fund manager Pimco, part of Allianz (AZ Quote), named Mohamed El-Erian as chief executive. El-Erian replaces Bill Thompson, who retires at the end of the year.

Meanwhile, hedge fund Atticus Capital refuted rumors it is closing down. Earlier this week, fellow fund Ospraie Management shuttered its business after making bad bets on commodities.

Shares of Merrill Lynch (MER Quote) appeared to be headed for a rough day after Goldman Sachs slapped a "conviction sell" sticker on the stock, saying it foresees more asset writedowns in Merrill's future.