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U.S. stocks fall on weak June jobs report; Dow down 0.96%

Published 07/06/2012, 04:13 PM
Updated 07/06/2012, 04:16 PM
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Investing.com - U.S. stocks on Friday fell on news the economy added fewer jobs than predicted in June.

At the close of U.S. trading, the Dow Jones Industrial Average ended down 0.96%, the S&P 500 index was down 0.94% while the Nasdaq Composite index was down 1.30%.

The U.S. added a net 80,000 nonfarm payrolls in June, below market forecasts for a gain of around 90,000.

April figures were revised to 68,000 from 77,000 nonfarm payrolls, while May's numbers were revised to 77,000 from 69,000.

The numbers sent investors selling equities and snapping up safe-haven dollar positions on fears the U.S. economy continues to show signs of cooling.

The dollar index, which tracks the performance of the greenback versus a basket of six other major currencies, was up 0.66% at 83.48.

Monetary policy decisions outside of the U.S. sent investors racing to the dollar and selling stocks worldwide as well.

The European Central Bank cut its benchmark interest rate 25 basis points to 0.75%.

A Bank of England decision to inject GBP50 billion into the economy via stimulus measures followed by interest rate cuts in China also fueled the risk-off trading session.

The weak U.S. employment figures fueled fresh talk the Federal Reserve will consider stimulating the economy via quantitative easing, which would normally send stocks rising.

Under quantitative easing, the Fed buys assets from banks, injecting the financial sector full of liquidity to push long-term interest rates down to foster investment and job creation, weakening the dollar in the process and sending stocks gaining.

The next Federal Reserve monetary policy decision is not until Aug. 1, which kept stock-market bulls at bay on Friday.

Leading Dow Jones Industrial Average gainers included Kraft Foods, up 2.39%, McDonald's Corp., up 0.44%, and Wal-Mart Stores, up 0.38%.

Leading Dow Jones Industrial Average decliners included Hewlett-Packard, down 3.50%, Caterpillar, down 2.53%, and Alcoa, down 2.13%.

European indices, meanwhile, finished down.

After the close of European trade, the EURO STOXX 50 fell 2.15%, France's CAC 40 fell 1.88%, while Germany's DAX 30 finished down 1.92 %. Meanwhile, in the U.K. the FTSE 100 closed down 0.53%.








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