Stocks slipped Friday as investors eyed the weaker-than-expected June jobs report, and were cautious ahead of the long holiday weekend.

The Dow Jones industrial average (INDU) lost 36 points, or 0.4%, the Nasdaq (COMP) composite fell 8 points or 0.4% and the S&P 500 (SPX) index dipped 3 points, or 0.3%. On Thursday, the Dow and Nasdaq ended at 8-month lows and the S&P 500 at 9-month lows.

Stocks have tumbled in recent weeks, with the S&P 500 down more than 15% since the April highs on worries about the European debt crisis and U.S. economy. Stocks hit the lowest levels of the year Thursday following worse-than-expected economic readings on manufacturing and housing.

On Friday, the jobs report provided little relief, showing a rise in private sector hiring that was nonetheless smaller than expected, and a drop in the overall number of non-farm payrolls.

“The rise in private-sector payrolls shows we are moving in the right direction, but just not fast enough to keep up with all the headwinds in the economy,” said Jane Caron, chief economic strategist at Dwight Asset Management.

Jobs report: Employers cut 125,000 jobs from their payrolls last month, more than the 100,000 job cuts expected by economists surveyed by Briefing.com.

Most of the decline was a result of the 225,000 temporary Census employees that were let go after the conclusion of the survey.

On the upside, the private sector added 83,000 jobs, the report showed. However, that was shy of the 112,000 economists had been expecting.

The unemployment rate, generated by a separate survey, dropped to 9.5% from 9.7% in May. Economists thought it would rise to 9.8%.

Trading is expected to be volatile and volume light ahead of the long holiday weekend, with U.S. markets closed Monday in observance of Independence Day.

Jobs recovery hits a wall
Factory orders: In the day’s other economic report, the Commerce Department said factory orders fell 1.4% in May after rising 1% in April. Economists thought orders would fall 0.6%.

World markets: European markets climbed, with Britain’s FTSE 100 adding 0.9%, Germany’s DAX rising 0.1% and France’s CAC 40 gaining 0.7%.

Asian markets were mixed, with Japan’s Nikkei rising 0.1%, Hong Kong’s Hang Seng falling 1.1% and the Shanghai Composite rising 0.4%.

Commodities: U.S. light crude oil for August delivery fell 15 cents to $72.80 a barrel on the New York Mercantile Exchange.

COMEX gold for August delivery fell $2.70 to $1,204 an ounce.

Currency: The euro gained versus the dollar but remained above the four-year low of $1.188 hit earlier in the month. The dollar was up slightly versus the yen.

Bonds: Treasury prices fell, raising the yield on the 10-year note to 2.96% from 2.93% late Thursday. Treasury prices and yields move in opposite directions.

Market breadth: Market breadth was mixed. On the New York Stock Exchange, winners beat losers by a narrow margin on volume of 240 million shares. On the Nasdaq, decliners beat advancers six to five on volume of 420 million shares.

By Alexandra Twin

Tags: debt crisis, Dow Jones Industrial, economic, economists, european economy, investor market, Nasdaq composite, stock market, unemployment rate, us economic, us economy

This entry was posted on Friday, July 2nd, 2010 at 11:29 am and is filed under Debt, Economic Turmoil, Global Economy, Global Financial, Market Finance, US Deficit, World Financial, european economy. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.