Stocks open lower after weak April jobs report
Friday , May 04, 2012 - 10:14 AM
NEW YORK— U.S. stocks opened lower Friday after the government reported that hiring slowed in April, confirming a slew of data during the month that showed the economy was weakening.
The Dow Jones industrial average fell 83 points to 13,123 shortly after the opening bell Friday.
The Standard & Poor’s 500 index slipped 11 points to 1,380, while the Nasdaq composite index gave up 33 points to 2,991.
The Labor Department reported Friday that U.S. employers added just 115,000 jobs in April. That was below March’s revised number and well off the pace from earlier this year.
The unemployment rate fell to 8.1 percent, a three-year-low, but only because more people gave up looking for work. The government only counts people as unemployed if they are actively looking for work.
The price of oil also fell below $100 per barrel on worries that demand would drop because of a weakening world economy. It was the first time oil has dropped below $100 since February 13. Benchmark crude hit $99.99 in morning trading.
Energy company stocks turned lower in response. Southwester Energy Co. fell 3.5 percent and Marathon Oil Corp. fell 2 percent.
Traders were responding not only to the U.S. jobs figures but also nervousness over the outcome of weekend elections coming up in France and Greece. The results are likely to have a significant impact on how Europe’s debt crisis is handled over the next few months.
Scared investors are turning to safer investments like U.S. government bonds. The yield on the benchmark 10-year Treasury note fell to 1.89 percent from 1.92 percent late Thursday.
In other trading:
— American International Group fell 5.5 percent, the most in the S&P 500 index. The insurance company, which nearly collapsed during the financial crisis, reported late Thursday that its quarterly earnings doubled due largely to an appreciation in the value of its investments.
— LinkedIn rose 8 percent after announcing late Thursday that its first-quarter profit more than doubled, topping expectations. The social networking company also announced an acquisition.
— Kraft rose a little under 1 percent after the food company reported a modest increase in profit, boosted by the growing popularity of its cookies and chocolates in the developing world.