Dow Little Changed as Service Sector Job Growth Hits Lowest Level in a Year

NEW YORK (TheStreet) -- U.S. stocks fell Thursday as jobs growth in the service sector hit its lowest level in a year and unemployment claims rose.

  • The S&P 500 closed off 0.11% to 1,888.75 while the Dow Jones Industrial Average finished unchanged at 16,572.42. The Nasdaq dropped 0.91% to 4,237.74.
  • Initial jobless claims for the week of March 29 increased by 16,000 to 326,000, vs. the average economist's estimate of 317,000. The four-week moving average ticked up by 250. The February U.S. trade deficit arrived at $42.3 billion, compared with the expected deficit of $38.5 billion.
  • U.S. services sector growth accelerated in March, according to Markit, but the pace of employment weakened to its slowest in a year. The final service sector purchasing managers' index rose to 55.3 in March from 53.3 in February. The service sector accounts for about three-quarters of the U.S. labor market, with employers adding workers at the slowest rate since March 2013. The final employment index was at 51.8 in March against 51.9 in February.
  • The Institute for Supply Management said its non-manufacturing index rose to 53.1 in March from 51.6 in February. Expectations had been for a result of 53.3. Of the 18 industries tracked by ISM, 13 reported growth last month while five contracted.
  • The European Central Bank kept the benchmark interest rate unchanged at a record low of 0.25%, as expected. While the ECB did not stimulate the economy by opting for a negative deposit rate, traders noted that its policy statement appeared to take a step closer to adopting quantitative easing.
  • Major international markets were mostly higher. The UK FTSE 100 was off 0.22%, the DAX in Germany was rising 0.06%, the Hong Kong Hang Seng closed up 0.18%, and the Nikkei 225 settled ahead by 0.84%.
  • In corporate news, Google's unusual stock split is taking effect on Thursday. The new Class "C" shares will trade under its historic stock ticker (GOOG), while the Class A shares will trade under the new stock ticker (GOOGL). Class A shares gained 0.6%, while Class "C" shares added 0.48.
  • Juniper Networks (JNPR) increased 1.7% after the company said it expects to reduce its global headcount by about 6% and that it will incur estimated cash charges of about $35 million for the move during the fiscal 2014 first quarter.
  • E*Trade (ETFC) was the biggest percentage decliner in the S&P 500, off 6.5%.Other notable losers included Vertex Pharmaceuticals (VRTX) and Biogen (BIIB), down 4.4% and 2.5%, respectively.
  • Anadarko Pertroleum jumped to an all time high and closed at the biggest winner on the S&P 500, popping 14.5%.

-- By Jane Searle, Andrea Tse and Joe Deaux in New York

If you liked this article you might like

Forecast for S&P 500, Dow Industrials Remains Bullish, These Charts Show

Dow 20,000! It Should Mean Nothing to Investors, but Then Again...

Tradebird Investors Are Bullish on U.S. Stocks but Bearish on the Euro

Why Home Depot and Boeing Stock Fell Tuesday