WASHINGTON (dpa-AFX) - After failing to sustain an initial move to the upside, stocks gave back came under pressure in early trading on Friday. The major averages pulled back into negative after reaching new record intraday highs.
The major averages climbed well off their worst levels as the day progressed but still closed in negative territory. The Dow slid 220.43 points or 0.5 percent to 45,400.86, the S&P 500 fell 20.58 points or 0.3 percent to 6,481.50 and the Nasdaq edged down 7.31 points or less than a tenth of a percent to 21,700.39.
For the week, the major averages turned in a mixed performance. The tech-heavy Nasdaq jumped by 1.1 percent and the S&P 500 rose by 0.3 percent, but the narrower Dow dipped by 0.3 percent.
The early downturn on Wall Street came as traders digested a closely watched Labor Department report showing much weaker than expected U.S. job growth in the month of August.
The report said non-farm payroll employment crept up by just 22,000 jobs in August after climbing by an upwardly revised 79,000 jobs in July.
Economists had expected employment to increase by 75,000 jobs compared to the addition of 73,000 jobs originally reported for the previous month.
The report also showed the uptick of 14,000 jobs that had been reported for June was downwardly revised to a decrease of 13,000 jobs.
Meanwhile, the Labor Department said the unemployment rate inched up by 4.3 percent in August from 4.2 in July, in line with economist estimates.
Traders initially reacted positively to the report amid optimism the data will convince the Federal Reserve to lower interest rates later this month.
Buying interest waned shortly after the start of trading, however, leading some traders to cash in the early strength amid concerns about the outlook for the economy.
'In the near-term, weaker jobs data will increase the odds of a Fed rate cut, but could create shorter-term volatility, as a weaker labor market is not a sign of strength,' said Larry Tentarelli, Chief Technical Strategist for Blue Chip Daily Trend Report.
Sector News
Financial stocks turned in some of the market's worst performances on the day, with the NYSE Arca Broker/Dealer Index and the KBW Bank Index slumping by 1.9 percent and 1.8 percent, respectively.
An extended slump by the price of crude oil also weighed on oil producer stocks, dragging the NYSE Arca Oil Index down by 1.6 percent.
On the other hand, gold stocks moved sharply higher along with the price of the precious metal, resulting in a 2.5 percent surge by the NYSE Arca Gold Bugs Index.
Steel, biotechnology and housing stocks also saw considerable strength, helping to offset the weakness in the aforementioned sectors.
Other Markets
In overseas trading, stock markets across the Asia-Pacific region moved mostly higher during trading on Friday. Japan's Nikkei 225 Index shot up by 1.0 percent, while China's Shanghai Composite Index surged by 1.2 percent.
Meanwhile, the major European markets moved to the downside on the day. While the German DAX Index slid by 0.7 percent, the French CAC 40 Index fell by 0.3 percent and the U.K.'s FTSE 100 Index edged down by 0.1 percent.
In the bond market, treasuries moved sharply higher in reaction to the weaker-than-expected jobs data. Subsequently, the yield on the benchmark ten-year note, which moves opposite of its price, tumbled 9.0 basis points to a five-month closing low of 4.086 percent.
Looking Ahead
Next week's trading is likely to be driven by reaction to reports on consumer and producer price inflation, which could further impact the outlook for interest rates.
Copyright(c) 2025 RTTNews.com. All Rights Reserved
Copyright RTT News/dpa-AFX
© 2025 AFX News
