9 January 2004, 17:02  US stocks set to fall on disappointing jobs data

NEW YORK, Jan 9 - Stocks are set to drop at Friday's opening bell as a disappointing U.S. employment report for December damped investor enthusiasm over the economic recovery a day after the market hit multiyear peaks. Employers outside the farm sector barely took on any new workers last month, a government report showed, indicating the economic recovery has yet to translate into sustained jobs growth. The unemployment rate fell to 5.7 percent, the lowest level in over a year and down from 5.9 percent in November. But the number of workers on U.S. nonfarm payrolls in December increased by just 1,000. It was the fifth straight monthly rise but was far worse than expectations for a gain of 130,000. "It's certainly negative for market sentiment," said Edgar Peters, chief investment officer at PanAgora Asset Management. "The 1,000 jobs is like no jobs, and people seem to consider that an important indicator of the recovery."
Equity index futures had pointed to a lower start before the report and extended losses after the data. Standard & Poor's 500 stock index futures for March fell 5.30 points, while Nasdaq futures for the same month sank 13 points. Dow industrial futures fell 62 points. After the closing bell, aluminum maker and Dow component Alcoa Inc. kicked off the start of the quarterly reporting period by reporting a fourth-quarter profit -- a turnaround from a steep loss a year ago -- but also said it would cut jobs at New York smelters. Its shares fell to $37.60 before the bell after closing at $38.66. International Business Machines Corp. , another Dow component, said after Thursday's close that it may face civil charges in connection with a Securities and Exchange Commission probe into accounting for a used-equipment swap it arranged with discount retailer Dollar General Corp. . Separately, Dollar General said it may also face civil charges from the SEC in connection with its restatement of financial results for 1998 through 2000. Shares of IBM dropped to $92.31 before the bell after closing at $93.04. Dollar General had not yet traded before the bell, but closed Thursday at $21.67. U.S. stocks had rallied on Thursday, driving the major indexes to fresh multiyear closing highs after a surprise positive forecast from technology bellwether Nokia Corp. lifted investor optimism ahead of the earnings season. The technology-laden Nasdaq Composite Index <.IXIC> gained for the fifth straight day, adding 22.57 points, or 1.09 percent, to 2,100.25, its highest close since July 3, 2001. The Dow Jones industrial average <.DJI> ended up 63.41 points, or 0.60 percent, at 10,592.44, its highest finish since March 19, 2002. The broader Standard & Poor's 500 Index <.SPX> rose 5.59 points, or 0.50 percent, to 1,131.92, its highest finish since April 2, 2002.//

© 1999-2024 Forex EuroClub
All rights reserved