Stocks Post Losses at the Close After Tumbling on Jobs Data
A stronger-than-expected July
employment report
beat up stocks, as the market ended the week on a bitter note.
The jobs data were seen as bumping up the odds that the
Federal Open Market Committee
will raise interest rates when it meets later this month. And some traders fretted that
Greenspan & Co.
may not stop at just one rate hike.
The 30-year Treasury bond got buried as its yield rose to 6.18%.
The
Labor Department
reported nonfarm payrolls grew by 310,000 in July, much higher than the consensus estimate of 199,400 among economists surveyed by
Reuters
. Meanwhile, the unemployment rate came in at 4.3% in July, unchanged from June. Average hourly earnings rose 0.5%, higher than the forecast of an increase of 0.3%.
Breadth was atrocious and volume was light overall. Major market averages did manage to close off their lows, however: the
Dow Jones Industrial Average
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bottomed at 10,653.25; the S&P 500 cratered at 1293.19; and the
Nasdaq Composite Index
bottomed at 2535.63.
Scott Curtis, senior equity trader at
Brown Brothers Harriman
, said market psychology is very negative.
People are selling into rallies and not aggressive buyers, Curtis pointed out.
Curtis said that it looked like there was a selling climax yesterday, but then "we get broadsided again" today.
Internet stocks, which enjoyed a stunning turnaround
yesterday, tumbled today. The biggest losers were
Inktomi
(INKT)
and
Amazon.com
(AMZN)
.
Financial stocks, which are sensitive to interest rates, got pounded. The
Philadelphia Stock Exchange/KBW Bank Index
swooned 2.8%, while the
American Stock Exchange Broker/Dealer Index
surrendered 3.5%.
The
Dow Jones Transportation Average
took a shellacking. It fell 1.9%.
On the
New York Stock Exchange
, decliners thumped advancers 1,969 to 966 on 699.8 million shares. On the
Nasdaq Stock Market
, losers pounded winners 2,179 to 1,693 on 808.1 million shares.
On the NYSE, 192 issues set new 52-week lows while 41 touched new highs. On the Nasdaq, 89 issues set new 52-week lows while new highs totaled 35.
On the Big Board,
America Online
(AOL)
was most active, with 24.4 million shares changing hands. It was up 3/4 to 84 11/16. AOL said it reached deals with Net service providers
EarthLink Network
(ELNK)
and
MindSpring Enterprises
undefined
to offer instant messaging services.
EarthLink was up 4 9/16, or 12.3%, to 41 9/16, while MindSpring was up 2 11/16, or 10.3%, to 28 13/16.
On the Nasdaq,
Microsoft
(MSFT)
was most active, with 33.5 million shares changing hands. It was down 5/8 to 85 1/8.
Market data above are preliminary. Updated numbers and analysis will follow in the Market Roundup
Earlier...
3:05 p.m.: Stocks Reel Into Final Hour With Sharp Losses
Stocks and bonds left investors checking their medical bracelets this afternoon, as they kept falling and couldn't get up. A strong July
employment report
, which many see as a sign that the
Federal Open Market Committee
will hike interest rates, pushed the market down the stairs.
1:55 p.m.: Jobs Data Continue to Depress Stocks
Stocks and bonds were limping along this afternoon, kicked in the shins by a stronger-than-expected July
employment report
, which was viewed as boosting the odds that the
Federal Open Market Committee
will hike interest rates when it meets later this month.
1:28 p.m.: Midday Musings: Blue-Chip Retreat as Fed Talk Fills the Air
11:56 a.m.: Stocks Remain Mostly Lower After Jobs Data
In a choppy session, most major market gauges were lower late this morning in the wake of a stronger-than-expected July
employment report
.
10:59 a.m.: Stocks Mostly Lower After Brief Foray Into Positive Territory
After tumbling out of the gate on a stronger-than-expected
employment report
, major market averages climbed into the green, but have now lost that momentum as the
Nasdaq Composite Index
was the only major stock index on the plus side at midmorning.
10:01 a.m.: Stocks Mostly Lower After Jobs Data
A stronger-than-expected July
employment report
, seemingly clinching that the
Federal Open Market Committee
will raise rates later this month, was taking a modest toll on stocks early on.
