Midday Update: Wall Street Worsens as Jobs Report Fuels Expectation for March Rate Hike
Stocks erased all of Thursday's gains and were deep in negative territory after the Labor Department reported that January job growth was slower-than-expected even as the jobless rate fell to an 8-year low and average hourly earnings rose a greater-than-expected 0.5%. The data, which keeps a March rate hike on the table, coupled with softer oil prices , drove equities lower at the open, led by losses in the technology and consumer sectors. Conversely, defensive stocks in the utility and telecommunications sector continued to outperform.
The Nasdaq is the laggard again today with biotech stocks also on the defensive, while the S&P 500 flirts with key support at 1,872. All three benchmark indices are expected to close out the week in the red.
Today's other data was a wider-than-expected trade deficit in December to $43.36 billion from a revised $42.23 billion in November, missing estimates for a deficit of $43.0 billion.
In corporate earnings, LinkedIn ( LNKD ) shares were at a new three-year low and are putting in their worst daily performance after the company beat Q4 earnings, but issued weak guidance for Q1 as a result of challenges in Europe and Asia. Tableau ( DATA ) shares fell to a record low on a bleak 2016 outlook, taking shares of Qlik Technologies ( QLIK ) and Splunk ( SPLK ) sharply lower in sympathy.
European markets are also lower in reaction to the U.S. jobs report which gives the Federal Reserve the ammunition to raise rates again in March. Gains in retail stocks on bullish sales reports were offset by weaker prices in oil stocks.
Crude oil was down $0.26 to $31.46 per barrel. Natural gas was up $0.08 to $2.06 per 1 million BTU. Gold was down $2.30 to $1,155.10 an ounce, while silver was down $0.09 to $14.77 an ounce. Copper was down $0.03 to $2.10 per pound.
Among energy ETFs, the United States Oil Fund was down 0.77% to $9.05 with the United States Natural Gas Fund was up 2.89% to $7.49. Among precious-metal funds, the Market Vectors Gold Miners ETF was up 1.42% to 16.38 while SPDR Gold Shares were up 0.10% to $110.46. The iShares Silver Trust was down 1.06% to $14.02.
Here's where the markets stand at mid-day:
NYSE Composite Index was down 101.99 points (-1.07%) to 9,432.31
Dow Jones Industrial Index was down 148.34 points (-0.90%) to 16,268.24
S&P 500 was down 25.76 (-1.35%) to 1,889.91
Nasdaq Composite Index was down 106.62 points (-2.36%) to 4,402.95
FTSE 100 was down 50.70 points (-0.86%) to 5,848.06
DAX was down 107.13 points (-1.14%) to 9,286.23
CAC 40 was down 27.86 points (-0.66%) to 4,200.67
Nikkei 225 was down 225.40 (-1.32%) to 16,819.59
Hang Seng Index was up 105.08 points (+0.55%) to 19,288.17
Shanghai China Composite Index was down 17.53 points (-0.63%) to 2,763.49
NYSE SECTOR INDICES
NYSE Energy Sector Index was down 121.01 points (-1.36%) to 8,793.36
NYSE Financial Sector Index was down 63.20 points (-1.13%) to 5,534.54
NYSE Healthcare Sector Index was down 119.93 points (-1.04%) to 11,401.05
(+) LF (+71.36%) To be acquired by VTech for $72 million
(+) TSN (+9.91%) Reported better-than-expected earnings, but missed revenue estimates, issued mixed guidance for FY16
(+) SYMC (+4.22%) Announced stronger-than-expected Q3 results, $500 million investment by Silver Lake Partners, $2.3 billion share buyback, and $4 per share special dividend
(-) LNCO (-66.28%), LINE (-51.85%) Seeking strategic alternatives for its capital structure as a result of "market challenges"
(-) DATA (-48.35%) Swung to a loss for Q4, sales beat estimates and increased 42% from year ago
(-) LNKD (-40.44%) Beat Q4 EPS estimates, but issued a weak Q1 forecast
(-) QTNT (-27.18%) Underwritten public offering of 4.4 million shares priced at 13% discount to Thursday's closing price
(-) SWIR (-24.51%) Missed quarterly estimates, issued weak Q1 guidance
(-) GNW (-18.64%) Reported a surprise Q4 loss on weaker revenues that missed consensus forecasts, plans to halt sales of life insurance products in Q1
(-) OUTR (-17.53%) Q4 earnings fell from year ago level, guided FY16 EPS below estimates
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