U.S. Shares Rattled By Weak Labor Data, Pullback In Oil

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U.S. stocks pulled back on Friday as investors exited positions in what are normally considered riskier investments. But the crisis in the equity market created an opportunity in the gold market amid strengthening demand for safe-haven assets.

How major indices performed

The Dow

Dow Jones Industrial Average 2 Minute (INDEXDJX:.DJI) shed 119.85 points on Friday to settle 0.7% below the previous day’s closing. Financial stocks led the loss in the Dow.

The S&P 500

The S&P 500 (INDEXSP:.INX) dropped 19.41 points to pull back 0.9% from its previous closing.

Financial and energy stocks led the loss in the S&P 500. The financial component of the S&P 500 was down 1.5%. The fallout in the global bonds market rattled financial stocks across board.

But it was the Energy component of the S&P 500 that registered the worst performance on Friday, pulling back 2%. The loss in energy stocks was caused by the nearly 3% decline in U.S. crude oil (NYSEARCA:OIL) prices to just $49.07 a barrel. Oil recently rallied amid hope that unrest in Nigeria’s oil belt and the wildfire in Canada’s oil regions would help accelerate the removal of the global oil supply glut.

Telecommunications and consumer staples stocks in the S&P 500 bucked the trend of financial and energy stocks. Telecom component of the index rose 0.8% and consumer staples stocks gained 0.1%.

The Nasdaq

NASDAQ Composite (INDEXNASDAQ:.IXIC) also shed 64.07 points on Friday to close 1.3% below the previous day’s closing price.

Events to watch

This week, investors will be keeping a close eye on what comes out of the Fed officials meeting, especially their assessment of the U.S. economy and the path to interest rate increases in 2016. It had been hoped that the Fed would review interest rates upward in either June or July, but those hopes quickly faded following surprisingly weak U.S. labor data. Only 38,000 new jobs were added in the U.S. in May, the lowest monthly job addition since at least September 2010.

Besides the meeting of the U.S. central bank, investors will also be watching the outcome of the meetings of central banks in the U.K., Switzerland and Japan this week.

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