Economic worries lead market lower after jobs data
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Fri, 07 Mar 2008 17:49:07 GMT |
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Reuters |
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US (Business) |
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By Kristina CookeNEW YORK (Reuters) - U.S. stocks fell on Friday after a government report showed employers unexpectedly cut jobs in February at the steepest rate in nearly five years, compounding fears of recession in the world's largest economy.Big industrial companies seen as economic bellwethers such as heavy-equipment maker Caterpillar and conglomerate General Electric were among the biggest drags.Energy companies also felt the pinch from economic concerns, even as oil set a record high. Exxon Mobil and Chevron weighed on the S&P 500 and the Dow.The jobs data, higher oil and problems in the financial system show "we have a long way to go until the economy is back up and running at full-tilt. You are looking for a silver lining and you just can't find it," said Edward Bretschger, director of equity sales and trading at Calyon Securities in New York.The Dow Jones industrial average <.DJI> was down 113.97 points, or 0.95 percent, at 11,926.42. The Standard & Poor's 500 Index <.SPX> was down 9.29 points, or 0.71 percent, at 1,295.05. The Nasdaq Composite Index <.IXIC> was down 8.51 points, or 0.38 percent, at 2,211.99.Struggling bond insurers were again in the spotlight. Shares of Ambac Financial Group Inc fell 5.9 percent to $6.98 after it sold $1.5 billion of shares and convertibles to protect the company's credit ratings, but investors who wanted the company to raise more were disappointed.But financial shares were slightly higher after the Federal Reserve announced a revamped measure to ease strains in the credit markets. Analysts also noted that investors who had bet the sector would fall further reversed their "short" positions.Minutes before the jobs report, the Fed said it would increase amounts in its Term Auction Facility auctions March 10 and March 24 to $50 billion each, a rise of $20 billion from the amounts announced for each of these auctions.Employers cut payrolls for a second straight month, and it was the biggest monthly job decline in nearly five years.Caterpillar shares fell 1.6 percent to $69.90, while General Electric shares fell 1.3 percent to $32.44.Chevron's shares dropped 2.3 percent to $85.81, while Exxon Mobil dropped 2 percent to $82.82.(Editing by Kenneth Barry)
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