After moving sharply lower in early trading on Friday, stocks regained some ground in the latter part of the trading day but still ended the day mostly negative. A much weaker than expected jobs report contributed to the weakness on Wall Street.
The major averages ended the day well off their worst levels but still closed in the red. The Dow fell 40.86 points or 0.3 percent to 14,565.25, the Nasdaq dropped 21.12 points or 0.7 percent to 3,203.86 and the S&P 500 slid 6.70 points or 0.4 percent to 1,553.28.
With the losses on the day, the major averages all moved lower for the week. While the Dow edged down by 0.1 percent, the Nasdaq tumbled 1.9 percent and the S&P 500 fell 1 percent.
The sell-off seen at the start of trading came on the heels of the release of a report from the Labor Department showing much weaker than expected job growth in the month of March.
The report showed that employment edged up by 88,000 jobs in March following an increase of 268,000 jobs in February.
Economists had expected an increase of about 193,000 jobs compared to the addition of 236,000 jobs originally reported for the previous month.
Despite the lackluster job growth during the month, the unemployment rate unexpectedly dipped to 7.6 percent, hitting its lowest level since December of 2008.
Paul Ashworth, Chief U.S. Economist at Capital Economics, said, "After a very rapid start to the year, economic growth and employment gains have slowed quite sharply in March, repeating what we've seen in the past couple of years."
"We don't anticipate the slowdown becoming too severe, not when the housing recovery is firing on all cylinders, but it is a reminder that the U.S. is still unable to sustain what used to be just average rates of growth," he added.
Helping to limit the downside for the markets, a separate report from the Commerce Department showed that the U.S. trade deficit unexpectedly narrowed in the month of February.
The report showed that the trade deficit narrowed to $43.0 billion in February from a revised $44.5 billion in January. Economists had expected the deficit to widen to $44.8 billion.
While most of the major sector indices ended the session well off their worst levels of the day, significant weakness remained visible among networking stocks. The NYSE Arca Networking Index tumbled by 2 percent to its worst closing level of the year.
Ciena (CIEN) and Juniper Networks (JNPR) turned in two of the networking sector's worst performances, falling by 3.5 percent and 3.2 percent, respectively
Computer hardware stocks also ended the day sharply lower, resulting in 1.5 percent drop by the NYSE Arca Computer Hardware Index. Storage stocks Seagate Technology (STX) and Western Digital (WDC) helped to lead the way lower.
Internet, tobacco, and health insurance stocks also posted notable losses on the day, while natural gas and truck stocks rallied.
In overseas trading, stock markets across the Asia-Pacific region turned in yet another mixed performance. Japan's Nikkei 225 Index surged up by 1.6 percent, while Hong Kong's Hang Seng Index tumbled by 2.7 percent.
Meanwhile, the major European markets all showed notable moves to the downside on the day. While the German DAX Index plunged by 2 percent, the French CAC 40 Index and the U.K.'s FTSE 100 Index fell by 1.7 percent and 1.5 percent, respectively.
In the bond market, treasuries moved sharply higher on the weak jobs data, extending their recent upward move. Subsequently, the yield on the benchmark ten-year note, which moves opposite of its price, fell 6.5 basis points to a nearly four-month closing low of 1.694 percent.
After a slow start to the week, the economic calendar picks up, with traders likely to keep a close eye on reports on retail sales, producer prices, and consumer sentiment.
Aluminum giant Alcoa (AA) is also scheduled to release its first quarter results next Monday, marking the unofficial start to the quarterly earnings season.
by RTT Staff Writer
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