Stocks had a rough day from the get go, as the much anticipated jobs report drastically disappointed investors. The Dow Jones Industrial Average dropped 249.97 points (-1.87%), Standard & Poor's 500 index decreased 25 points (-1.69%), and the Nasdaq was down 48.62 points (-1.86%). Volume on the NYSE was the highest of the week at 3.15 billion shares, and decliners dominated advancers 3:1.
Investors had been waiting for the job report all week. Though the unemployment rate came in as expected at 4.6%, payrolls dropped an unexpected 4,000 jobs, the first drop in four years. Economists forecasted the number would be a positive 110,000. Investors pushed the market down on recession worries after the number was reported at 8:30 AM, and the market never came close to recovering. It was an atrocious number, but really makes it difficult not to imagine a rate cut in 11 days. The US 10-year bond's price was up 1-4/32, sinking the rate to 4.37%.
No sector ended with gains. The materials (-2.3%), Energies (-2.14%), Consumer Discretionary (-2.4%) sectors were hit the worst. Harley Davidson fell 9.2% to $49.09 after lowering earnings estimates for 2007 and 2008 and simply withdrawing guidance for 2009. Homebuilders Hovnanian, -7.1% on disappointing earnings, and Beazer, -12.9% after receiving default notices, saw huge drops as well. At the NYMEX, crude oil was up 42 cents to $76.72.
There is no major US economic data expected Monday. For the week, all three major indexes, though still up for the year, finished down more than 1%.
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