Market briefing --- Lane (medium)
Job reports --- Allan (slow)
NYSE --- Julie (slow)
Nasdaq --- June (slow)
>> welcome to national world. allan dodda frank joins us with more.
>> they had forecast a quarter million new jobs and only 32,000 workers were added to payrolls in july.
>> i don’t think anybody expected this much soft turn. in fact, i would call it pathetic. this means the economy has basically hit some type of a brick wall in june and that wall is probably made out of barrel of oil.
>> the low number had immediate implications in the presidential race and for the federal reserve as it considers raising interest rates. 32,000 workers added to payrolls in july represent just 1/8 of the consensus forecast for job growth. employment was also revised lower for may and june. the employment rate fell to 5.5 the unemployment rate fell to a.5% t lowest since october 2001. hours worked rose as did hourly and weekly earnings. overall, though, the news was disappointing throughout the report. manufacturers added jobs but only 10,000. employment and service producing industries including retailers, bank, and government agencies rose 14,000 last month t fewest jobs in a year. the unexpectedly weak report raises questions about whether fed policy maker wills go ahead with the forecast increase in interest rates on tuesday. fed funds futures have been trading down, but still show traders pricing in a quarter point move to 1.5%. u.s. treasury secretary john snow says the recovery remains on track.
>> there’s an awful lot of good news here as well, which is consistent with the notion that we hit a soft patch in the second quarter, the latter part of it, but the underlying economy remains strong and we’re on a good growth path.
>> the camp of democratic presidential campaign candidate john kerry had a different reaction to today’s number.
>> these are very disappointing, very anemic job numbers. not only is the job market not turning the corner, but it’s not even clear it’s moving in the right direction.
>> kerry issued a statement saying today’s job numbers show the economy might be, and i’m quoting here “taking a u-turn.” next week the focus turns to the fed. the interest rate decision comes out on tuesday. lane?
>> going to be a big one. thank you very much.
>> you’re welcome.
>> now let’s take a look at what happened in the markets follows the news. ahead of the trading at lehman brother, matthew johnson said stocks were already cheap and going to get cheaper. running down the numbers, the dow jones industrial average down 1.5%. 147 points on the day. dropping to 9815. the s&p 500 down 1.5% at 1063. nasdaq taking the hardest hit down nearly 2.5% on the session. volume-wise, 1.5 billion shares changed hands on this august friday at the new york stock exchange. 1.7 billion at the nasdaq. take a look at some. o over indicators of the market , the nyse index. the amex index down a quarter of 1% and the russell 2000 showed that the small caps fell in line with the nasdaq with 2.4%. the will shire 5000 is the broadest measure of the market and declined by 1.5% on the day. thresh rirks however, going the other direction. surging on speculation that the low slow down is more than temporary. investors pushing the 10-year yield to the lowest since april with a 1.5 point rise on the day. on the shorter end of the curve, the five year up more than a point and you can see the two year ton day up a half point. the yield at 2.38%. the dollar plunged against the yen and the euro as the jobs report raises serious questions about further rate hikes. currency traders say the dollar could weak ton as low as 1.24 per euro once it passes 1.22. the dow and the s&p closed at the low of the years today, capping off a losing week. julie hyman wraps up the day’s action at the new york stock exchange.
>> well t dow and the s&p not only closing for the lows for the year today, but the dow closing at the lowest since late november. for the s&p, it was the lowest since early december. also, for the week we saw big drops in the indexes. for the dow, the biggest drop since march on the week, the second worst week for the year. for the s&p, it was the worst week since the last week of last september. so really a dismal couple of days here at the big board. and now really it was the jobs report indeed that pushed us down in today’s session. we talked to fred caposesi, the head of the equity division at blaylock and partners and said this is a turning point. i don’t think we’ll have any sustained rallies in the near future. certainly judging from today’s session, not much reason for traders to be terribly optimistic. want to look at some of the biggest decliners in today’s session. a lot of decliner witness the technology group. semiconductors down almost 4%. some of the biggest culprits are intel, texas instrument, as well as advanced microdevices. there is a continuing concern about consumer spending on top of yesterday’s retail sales report that the consumer will cut down on the discretionary spending and semiconductor companies suffering in particular because they provide chips for a lot of devices that consumers tend to buy. also, tech hardware stocks falling for the same reason. companies like i.b.m. as well as hewlett packard down in today’s session. and also, as you might imagine, employment stocks doing poorly today. these companies that depend on folks looking for jobs in order for the bottom line to do well. robert half, monster, and manpower all lower today. back over to you.
>> jawley hyman at the big board. june grasso has details from the market site in times square.
>> the weak job growth numbers led to a decline in employment-related stocks. monster worldwide t world’s most used internet site for hell 7-wanted advertising led a decline in employment related shares reaching the lowest in err yoof paychex was also down as it paid for staffing and career management company at kforce.com. one of the biggest drags was nvidia. they said second-quarter profit fell to three cents a share on sales of $456 million, well below analysts expectations of earnings of 15 cents on revenue of $501 million. several analysts have downgraded the company today. credit suisse first boston said they faced significant pressure if intel lowered prices. a exet competitor of nvidai, a t.i. was one of the worst performing stocks as well today. a.t.i. hasn’t changed the forecast for the fourth quarter. let’s look now at m.c.i., the number two long distance carrier. this company was one of the better performers today. it surged as much as 19% after the company said it will begin paying a 40-cent quarterly dividend, giving the stock a higher yield than any company in the s&p 500 index. the company said it has $2.2 billion in excess cash. analysts at credit suisse first boston and lehman brothers raised the ratings. lehman brothers saying in a note to clients that it was due to the expected dividend yield support for the stock and the company’s cost-cutting measures. that’s it today from the nasdaq.
>> june grasso. now, after reaching a record today, crude oil futures fell on friday on speculation a slowdown in u.s. economic growth will reduce demand for gasoline, diesel, and other fuels. new york oil is surpassed intraday records every day this week as the russian government froze yukos accounts. that and an upcoming referendum in venezuela is boosting concerns here. it closed at $43.95 a barrel. other energy movers, gasoline was down as was heating oil and natural gas futures following the trend we saw with crude even though it did touch a record high but moved lower at the end of the day. and gold futures in new york had the biggest gain in four weeks. that following the plunge in the dollar. gold rose above $400 an ounce for the first time in two weeks. and one gold investor says the job figures came as a shock and people are buying gold as an insurance policy against a weakening economy. the disappointing jobs numbers prompting speculation that the economic slowdown may prove to be more than temporary. up next, we’ll talk about the outlook with charles mcmillion at m.g.m. services coming up when we return. stay with us.
