Stocks have moved mostly lower in morning trading on Friday, giving back ground following the rally seen over the course of the previous session. The major averages have all moved to the downside, with the tech-heavy Nasdaq posting a particularly steep loss after outperforming on Thursday.
Currently, the major averages are off their lows of the session but still firmly negative. While the Nasdaq is down 217.79 points or 1.8 percent at 12,099.11, the S&P 500 is down 46.28 points or 1.1 percent at 4,130.54 and the Dow is down 190.76 points or 0.6 percent at 33,057.52.
Traders seem to be cashing in on yesterday’s strong gains, as stronger than expected jobs data has offset the faint hopes that the Federal Reserve might slow its planned pace of interest rate hikes.
The Labor Department’s closely watched monthly employment report showed job growth in the U.S. exceeded economist estimates in the month of May.
The report showed non-farm payroll employment jumped by 390,000 jobs in May after surging by an upwardly revised 436,000 jobs in April.
Economists had expected employment to increase by about 325,000 jobs compared to the addition of 428,000 jobs originally reported for the previous month.
Meanwhile, the Labor Department said the unemployment rate remained unchanged at 3.6 percent. The unemployment rate was expected to edge down to 3.5 percent.
The report also showed average hourly earnings rose by $0.10 or 0.3 percent to $31.95 in May. The annual rate of wage growth slowed to 5.2 percent in May from 5.5 percent in April.
“The May employment report underscores Chairman Powell’s view of the labor market still being extraordinarily tight despite some moderation in wage growth,” said Kathy Bostjancic, Chief U.S. Economist at Oxford Economics.
She added, “As such, today’s report supports the Fed raising the fed funds rate by 50bps at each of its June and July meetings.”
A separate report from the Institute for Supply Management showed growth in U.S. service sector activity…
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