US Stock Market Overview – Stocks Slide Following Soft US Payroll Report

David Becker

US stock prices whipsawed between positive and negative territory for most of the session with the Dow underperforming and all three major indices closing in the red. Both Facebook and Microsoft had technical outside days which points to a potential round of profit-taking. The Dow Industrials hit 29K for the first time in history but turned lower into the close. Most sectors in the S&P 500 were lower, led down by Financials, while real-estate bucked the trend.

Non-farm payrolls were released by the Department of Labor, coming in softer than expected. US yields moved lower, and the dollar eased, which paved the way for higher gold prices. Oil prices were lower, unable to gain traction following whipsaw price action earlier in the week. Volatility remained subdued which means that investors remain confident.

Job Growth is Softer than Expected

The US labor department reported on Friday that US Nonfarm payrolls increased 145k, less than the 160k expected, while the unemployment rate held steady at 3.5%. Revisions to the October and November numbers brought those two months down by 14,000 as well.

Average hourly earnings rose by just 2.9%, below the 3.1% projection. December marked the first time that wage gains were below 3% July 2018. Average hourly earnings increased 3 cents last month to $28.32. The labor force participation rate held steady at 63.2% as the workforce rose by 209,000 to 164.6 million and the job pool fell by 48,000 to 95.6 million.

The total employment level rose to 158.8 million, also a fresh high. However, the unemployment rate for African Americans rose 0.3 percentage points to 5.9%. There were still 477,000 open positions as of October, down less than 5% from the year-ago level, according to the Labor Department.

Volatility is Priced Low

There is still a geopolitical risk and while the Trump administration will use sanctions, Iran is likely to increase terrorism., The Trump administration expanded its sanctions campaign against Iran. The US secretaries of state and treasury signaled the administration is choosing to wage more economic war rather than use military force.

Don't miss a thing!
Discover what's moving the markets. Sign up for a daily update delivered to your inbox

Latest Articles

See All

Expand Your Knowledge

See All
IMPORTANT DISCLAIMERS
The content provided on the website includes general news and publications, our personal analysis and opinions, and contents provided by third parties, which are intended for educational and research purposes only. It does not constitute, and should not be read as, any recommendation or advice to take any action whatsoever, including to make any investment or buy any product. When making any financial decision, you should perform your own due diligence checks, apply your own discretion and consult your competent advisors. The content of the website is not personally directed to you, and we does not take into account your financial situation or needs.The information contained in this website is not necessarily provided in real-time nor is it necessarily accurate. Prices provided herein may be provided by market makers and not by exchanges.Any trading or other financial decision you make shall be at your full responsibility, and you must not rely on any information provided through the website. FX Empire does not provide any warranty regarding any of the information contained in the website, and shall bear no responsibility for any trading losses you might incur as a result of using any information contained in the website.The website may include advertisements and other promotional contents, and FX Empire may receive compensation from third parties in connection with the content. FX Empire does not endorse any third party or recommends using any third party's services, and does not assume responsibility for your use of any such third party's website or services.FX Empire and its employees, officers, subsidiaries and associates, are not liable nor shall they be held liable for any loss or damage resulting from your use of the website or reliance on the information provided on this website.
RISK DISCLAIMER
This website includes information about cryptocurrencies, contracts for difference (CFDs) and other financial instruments, and about brokers, exchanges and other entities trading in such instruments. Both cryptocurrencies and CFDs are complex instruments and come with a high risk of losing money. You should carefully consider whether you understand how these instruments work and whether you can afford to take the high risk of losing your money.FX Empire encourages you to perform your own research before making any investment decision, and to avoid investing in any financial instrument which you do not fully understand how it works and what are the risks involved.
FOLLOW US