Updated from 10:46 a.m. EST
Stocks in New York continued to trade with losses midday Friday after the U.S. government reported the final jobless data for 2008 -- the worst year for unemployment in more than 60 years -- and the president elect reiterated the critical need for an economic stimulus effort.
Dow Jones Industrial Average
was losing 100 points at 8642, and the
was off by 14 points at 895. The
was down 31 points at 1585.
warned late Thursday that its fourth-quarter earnings will suffer the detriment of huge declines in crude prices at the end of 2008. It was
, which said earlier in the week that it will do away with 15,000 full-time positions and cut output to deal with the pesky economy. Both stocks were trading lower Friday.
Alcoa isn't the only one divesting its ranks. The
, in line with estimates, according to data from the Labor Department on Friday. The figure was considerably better than a forecast released by ADP Employment Service earlier in the week had suggested it might be.
The unemployment rate, however, was worse than expected, rising to 7.2%. For all of 2008, the economy lost a net total of 2.6 million jobs, the most since 1945.
The release of the data "reminds us that the economy is facing major headwinds as we start the New Year," says Michael Sheldon, chief market strategist at RDM Financial Group, in an email. Moreover, he says, news on the labor front is likely to continue getting worse before it gets better.
"There's no disagreement that the economy is in dire straits and we need to create jobs," said President-elect Obama, as he introduced his intelligence appointments on Friday.
Behind the statistics flashing on the screens are real lives, said the president elect, urging Congress to focus on readying and passing an economic stimulus plan. "What we can't do is drag this out when we just saw half a million more jobs lost."
If there's a silver lining, said RDM Financial's Sheldon, you might argue that the jobs report reflects the severe credit crises that we experienced late last year, but doesn't yet account for an of the recent improvements in the credit markets, or the large upcoming stimulus plan.
Indeed, economic data and monetary policy are becoming more peripheral as investors are already baking in the expectation for some sort of stimulus package, says Chris Johnson, CEO and chief investment strategist of Johnson Research. Rather, he says, focus has shifted to the first earnings season of the year, and we are starting to see companies like
adjusting their outlooks for 2009. As those roll in, we have a good chance of retesting November lows, says Johnson.
The recession looks to be longer and more severe than originally forecast, said Boston
President Eric Rosengren, in an address at the Massachusetts Mortgage Bankers Association. "Still, there are indications that the second half of the year will show improvement," he said.
Senate Democrats said late Thursday that they'd reached an agreement with
to support a bill that would allow bankruptcy judges to alter the
owed by consumers filing for bankruptcy, aiming to alleviate foreclosures for those consumers.
Meanwhile, the private-equity arm of collapsed investment bank
has reached an agreement to spin out into an
, taking in a new investment from luxury-goods billionaire Johann Rupert, according to
The Wall Street Journal
In other corporate news, according to the
is wrapping up its search for a CEO. The
reports that final candidates include Carol Bartz, former CEO of
The dollar declined against other major currencies. Oil prices fell $1.75 to $40.07 a barrel, while gold added $5.20 at $859.70 an ounce.
Longer dated Treasuries were recently rising; the 10-year note was rising 17/32 to yield 2.4%, and the 30-year was up 30/32, yielding 3%.
Overseas, the FTSE in London and the DAX in Frankfurt were falling Friday. In Asia, Japan's Nikkei and Hong Kong's Hang Seng ended with losses.
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