Stocks open lower after disappointing job data
NEW YORK AP) -- Selling swept across Wall Street for a second straight session today on news that the economy shed jobs for the eighth straight month in August and at a faster-than-expected pace.
The Labor Department said payrolls shrank by 84,000 last month, more than the 75,000 economists predicted, and higher than the 51,000 jobs lost in July. The unemployment rate rose to a five-year high of 6.1 percent from 5.7 percent.
The report confirmed Wall Street's fears that the economy continues to weaken. The nation has lost nearly 550,000 jobs so far this year, eroding investors' hopes for a late-year recovery.
"This was an ugly number that pretty much confirms that our economy continues to trend downward," said Jack Ablin, chief investment officer of Harris Private Bank. "I had thought things were stabilizing, and this just knocks the legs out of any hope of seeing much economic improvement right now."
Meanwhile, a downgrade of Merrill Lynch & Co. compounded the market's misery. Goldman Sachs analyst William Tanona cut the nation's largest brokerage to a "sell" rating on expectations it will incur fresh write-downs on top of the $5.7 billion it announced in late July.
In the first hour of trading, the Dow Jones industrial average fell 63.26, or 0.57 percent, to 11,124.97.
Broader stock indicators also fell. The Standard & Poor's 500 index slid 7.46, or 0.60 percent, to 1,229.37, and the Nasdaq composite index fell 15.44, or 0.68 percent, to 2,243.60.
Stocks turned in a dismal performance on Thursday, with all three major indexes moving back into bear market territory, defined as a 20 percent drop from a recent peak. The Dow plunged more than 340 points in a sell-off underpinned by disappointing economic news and lackluster sales reports from retailers.
