Samsung Received 9 Million Pre-Orders for the Galaxy S3 [REPORT]
May 18, 2012
By Stan Schroeder | Mashable – samsung-galaxy-s-iii-books-600 Samsung has received 9 million pre-orders from more than 100 international carriers for its upcoming flagship smartphone , the Galaxy S3, Korea Economic Daily reports . Samsung’s smartphone factory in South Korea is running at full capacity, which is 5 million units per month, according to the same report. [More from Mashable : Samsung Galaxy Tab 2 10.1 Highlights Android’s Tablet Problem [REVIEW]] This is more good news for Samsung , which became the world’s biggest phone maker in Q1 2012
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By Stan Schroeder | Mashable –
samsung-galaxy-s-iii-books-600Samsung has received 9 million pre-orders from more than 100 international carriers for its upcoming flagship smartphone, the Galaxy S3, Korea Economic Daily reports.
Samsung’s smartphone factory in South Korea is running at full capacity, which is 5 million units per month, according to the same report.
[More from Mashable: Samsung Galaxy Tab 2 10.1 Highlights Android’s Tablet Problem [REVIEW]]
This is more good news for Samsung, which became the world’s biggest phone maker in Q1 2012. The company is also the undisputed king of the Android market: Its smartphone sales represent about 40% of all Android-based smartphone sales worldwide.
Samsung Galaxy S3 hits Europe on May 29, followed by a US launch in June.
[More from Mashable: Samsung’s 55-Inch OLED TV Will Cost $9,000 [REPORT]]
It sports a 4.8-inch touchscreen, a 8-megapixel rear-facing and 1.9-megapixel forward-facing camera, and comes with the latest version of Android — Ice Cream Sandwich.
[via Reuters]
This story originally published on Mashable here.
Stock ETFs: Brief Pullback or Serious Correction?
May 17, 2012
Since the most recent high in April, the equities market and stock exchange traded funds have been slowly receding.
Continued here:
Since the most recent high in April, the equities market and stock exchange traded funds have been slowly receding. Analysts are now worried that the tepid decline may snowball into a full-blown corrections as scared investors exacerbate the drop.
As of the April 2, 2012 market high, the S&P 500 has diminished 4.6%, a little short of the 5% to 10% decline to be defined as a “pullback,” Sam Stovall, Chief Equity Strategist at S&P Capital IQ, wrote in a research note.
“So far, the fall is simply noise, in our opinion,” Stovall said. “Of course, many investors are becoming unnerved by the growing intensity of this noise, believing it may be signaling the onset of a more severe storm. As a result, they have begun to act like a dog frightened by thunder that seeks the shelter of a nearby bed.”
Historically, since 1950, the S&P 500 has experienced a median 19 days to fall past the 5% threshold to hit a market pullback. Additionally, 72% of all pullbacks, corrections and bear markets fell below the 5% decline threshold in 28 days or fewer, compared to 25% of pullbacks that took over 28 days to become corrections and less than a third turned into new bear markets.
“Therefore the duration of this ‘noise’ likely indicates that the ultimate decline will be contained, unless new worries emerge or existing concerns become increasingly intensified in the coming weeks or months,” Stovall added.
Nevertheless, S&P Capital IQ believes the S&P 500 will experience a pullback of 5% to 10%, due to sub-par U.S. growth projections, accommodative Fed, mild recession in Europe along with a sluggish recovery and lower Chinese growth. [Seasonal Trends May Weigh on Stock ETFs]
Equity ETFs are pausing for breath after a big first quarter.
The phenomenal recovery in global markets during the first couple of months helped propel global equities to one of their best first quarters. Emerging markets, along with the health care, consumer discretionary and financial sectors, were among the top performers in Q1.
Over the first four months of the year, 609 equity ETFs showed a positive year-to-date total return, with 23 ETFs vaulting more than 20%, Tom Graves, S&P Capital IQ ETF analyst, wrote in a separate research note. Meanwhile, only 21 equity ETFs showed negative returns. In comparison, the S&P 500 Index had a positive return of 11.9% over the same period. [ETF Performance Report: Best First Quarter in Over a Decade]
Of the 609 positive equity ETFs, 339 were based on domestic indices and 226 had an international and global emphasis. The S&P Global Broad Market Index, which excludes the U.S., was up 9.1% in the first quarter. [Global ETFs Gather Record Q1 Inflows]
In the first quarter, 11 equity ETFs had returns of more than 25%. Seven covered the emerging markets or frontier markets and four followed U.S. markets. Additionally, six of the 11 followed the health care, consumer discretionary and financial sectors.
SPDR S&P 500 (SPY – News)
SPY_ETF
For more information on the broad market, visit our S&P 500 category.
Max Chen contributed to this article.
Full disclosure: Tom Lydon’s clients own SPY.
Six Morningstar Equity Analysts Among Winners of The Wall Street Journal's Annual Best on the Street Analyst Survey …
May 10, 2012
CHICAGO, May 10, 2012 /PRNewswire/ – Morningstar, Inc.
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CHICAGO, May 10, 2012 /PRNewswire/ – Morningstar, Inc. (MORN), a leading provider of independent investment research, today announced that six of its equity analysts have been honored in The Wall Street Journal’s 20th annual “Best on the Street” analyst survey, published today. Two Morningstar analysts ranked #1, one ranked #2, and three ranked #3 in their respective industries.
Morningstar analysts who were named Best on the Street for 2012 are:
- Basili Alukos, CFA, CPA, equity analyst, ranked first in the “Airlines” industry, out of 18 analysts;
- David Whiston, CFA, CPA, CFE, senior equity analyst, ranked first—for the second consecutive year—in the “Specialty Retailers and Services” industry, out of 74 analysts;
- Joung Park, equity analyst, ranked second in the “Mining and Metals” industry, out of 98 analysts;
- Matthew Coffina, CFA, senior equity analyst, ranked third in the “Food and Drug Retailers” industry, out of 23 analysts;
- Avi Feinberg, equity analyst, ranked third in the “Oil Equipment, Services, and Distribution” industry, out of 91 analysts; and
- Drew Woodbury, equity analyst, ranked third in the “Life Insurance” industry, out of 19 analysts.
“I’m so proud of our analysts, whose job is to take a long-term view in a market focused on the short term,” Catherine Odelbo, president of global equity and credit research for Morningstar, said. “Our team values the companies they cover as businesses, not as little pieces of paper to trade. This isn’t always the most popular approach, but it really delivers results.”
In 2011, the first year that Morningstar participated in the Best on the Street survey, three Morningstar analysts ranked #1, two ranked #2, and one ranked #5 in their respective industries. Morningstar’s press release about last year’s winning analysts is available at http://corporate.morningstar.com/us/asp/subject.aspx?xmlfile=174.xml&filter=PR4674.
The Wall Street Journal’s Best on the Street survey identifies the top three analysts in each of 44 industries, based on stock-picking skill. The data were assembled by FactSet, a Norwalk, Conn. company that tracks analysts’ recommendations and earnings estimates. To determine the winners, FactSet first identified more than 2,000 analysts at nearly 200 firms who fit the criteria to be counted in the rankings. To be eligible, analysts had to have followed at least five stocks in an industry group during 2011.
Morningstar will feature video interviews with the winning analysts on Morningstar.com at http://www.morningstar.com/goto/stockpickers. Morningstar.com Premium members and financial advisors using Morningstar® Analyst Research Center(SM) will have access to a special report, “Insights from the Best on the Street,” which covers some of the analysts’ stock picks. Institutional investors can access their research and valuation models at Morningstar’s institutional research portal, http://select.morningstar.com/welcome/.
Morningstar provides data on approximately 35,000 stocks and has 120 equity and credit analysts worldwide who provide qualitative analyst coverage on about 1,800 companies globally.
About Morningstar, Inc.
Morningstar, Inc. is a leading provider of independent investment research in North America, Europe, Australia, and Asia. The company offers an extensive line of products and services for individuals, financial advisors, and institutions. Morningstar provides data on more than 380,000 investment offerings, including stocks, mutual funds, and similar vehicles, along with real-time global market data on more than 8 million equities, indexes, futures, options, commodities, and precious metals, in addition to foreign exchange and Treasury markets. Morningstar also offers investment management services through its investment management subsidiaries and has more than $190 billion in assets under advisement and management as of March 31, 2012. The company has operations in 27 countries.
Media Contact:
Carling Spelhaug, 312-696-6150 or carling.spelhaug@morningstar.com
©2012 Morningstar, Inc. All Rights Reserved.
MORN-C
US stock futures extend gains on unemployment data
May 10, 2012
Associated Press – NEW YORK (AP) — U.S. stock futures are higher with the government reporting that weekly jobless claims edged downward last week, suggesting that employers may accelerate hiring this month
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Associated Press –
NEW YORK (AP) — U.S. stock futures are higher with the government reporting that weekly jobless claims edged downward last week, suggesting that employers may accelerate hiring this month.
Weekly applications dropped 1,000 to a seasonally adjusted 367,000 in the week ending May 5, the Labor Department said Thursday. The previous week’s figure was revised up slightly.
The Dow Jones industrial average rose 48 points to 12,843. The Standard & Poor’s 500 gained 9.8 points to 1,360.8. The Nasdaq composite index rose 11.5 points to 2,630.75.
The four-week average for jobless claims, which economists use for a less volatile peek at the employment picture, fell 5,250 to 379,000. When that figure remains consistently below 375,000, it suggests that job growth is strong enough to lower the unemployment rate.
The numbers released by the Labor Department could dispel nascent fears that that strongest yearly start for hiring since the recession ended 2009 was sputtering.
Applications for unemployment benefits rose for most of last month in tandem with weaker hiring in March and April.
There are still signs, however, that companies are still digging out from the recession and a solid hiring environment has yet to take root.
Late Wednesday, a giant in the technology sector spooked the market with a sobering outlook on spending, particularly with Europe weighing on any global recovery.
Cisco Systems Inc. posted strong third-quarter profits, but shares tumbled 8 percent in premarket trading Thursday on dour comments about the willingness of corporations to make substantial investments.
CEO John Chambers said customers are waiting longer to close deals and they are spending less out of uncertainty about the economy, particularly in Europe and India.
“We are still in an uncertain environment economically,” Chambers told analysts in a conference call.
As talks to form a Greek government dragged into a fourth day, European markets fell.
The FTSE 100 index of leading British shares slipped 0.5 percent to 5,501 while Germany’s DAX fell 0.2 percent at 6,461. The CAC-40 in France was 1.2 percent lower at 3,081.
In the U.S., Kohl’s Corp. said Thursday that first-quarter profit tumbled 23 percent and the department store chain warned that it may fall short of Wall Street expectations in the second quarter.
The report comes a day after Macy’s reported first-quarter earnings. While first-quarter profit rose 38 percent, Macy’s shares tumbled after the department store left its guidance unchanged.
Though the company tends to give conservative guidance, investors took it as a sign of a potential slowdown in consumer spending, which accounts for about 70 percent of U.S. economic activity.
Cisco’s sobering forecast overshadows 3Q earnings
May 9, 2012
By MICHAEL LIEDTKE | Associated Press – SAN FRANCISCO (AP) — Cisco raised the specter of a sharp slowdown in technology spending late Wednesday, rattling investors already fretting about the economy’s fragile condition.
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By MICHAEL LIEDTKE | Associated Press –
SAN FRANCISCO (AP) — Cisco raised the specter of a sharp slowdown in technology spending late Wednesday, rattling investors already fretting about the economy’s fragile condition.
The red flag raised by the world’s largest maker of computer-networking equipment overshadowed a solid showing in the most recent quarter.
Investors instead fixated on a sobering forecast for the current quarter that Cisco Systems Inc. CEO John Chambers traced to skittish customers who are waiting longer to close deals and spending less money because of growing uncertainty about the economy, particularly in Europe and India.
“We are still in an uncertain environment economically,” Chambers told analysts in a conference call.
The cautionary remarks sparked worries that Cisco might be about to fall into a slump similar to the one that it just pulled out of late last year after trimming about $1 billion in its annual expenses.
Those fears caused Cisco’s shares to plunge $1.58, or more than 8 percent, to $17.20 in extended trading Wednesday. The sell-off doesn’t bode well for the Dow Jones industrial average Thursday, as Cisco is one of the 30 stocks in the closely watched market barometer.
As a maker of big-ticket technology equipment with an international reach, Cisco is considered to be a good gauge of the swings in the global economy.
Cisco underscored its concerns about the economy by predicting its revenue for the current quarter, which runs May to July, will increase by just 2 percent to 5 percent from the same time last year. The average estimate among analysts surveyed by FactSet had called for a 7 percent increase in revenue.
The company, which is based in San Jose, Calif., expects its adjusted earnings for the period to range from 44 cents to 46 cents per share. Analysts had predicted adjusted earnings of 49 cents per share.
The prospect of weak revenue covers Cisco’s fiscal fourth quarter — typically the company’s busiest period. Although management didn’t look beyond the current quarter, investors are likely wondering whether the business climate for Cisco will be even worse in the late summer and early fall.
Chambers sought to reassure analysts telling them, “We will muddle through this with a little bit of bumps on the road.”
Cisco earned $2.2 billion, or 40 cents per share, during its fiscal third quarter, which ended April 28. That compared with net income of $1.8 billion, or 33 cents per share, at the same time last year.
If not for certain accounting items unrelated to its ongoing business, Cisco would have earned 48 cents per share. On that basis, Cisco’s earnings were a penny above the average estimate among analysts polled by FactSet.
Revenue rose 7 percent from last year to $11.6 billion, matching analyst projections.
Cisco’s showing contrasted with revenue downturns in the most recent quarters at two of its major rivals, Juniper Networks Inc. and Alcatel-Lucent. The earnings growth also provided the latest sign that Cisco’s recently completed overhaul is paying off. In that reorganization, Chambers laid off workers and dumped operations that he believed were distracting the company from its main business of selling computer-networking equipment.
But, Chambers stressed Wednesday, Cisco may be facing economic challenges beyond its control.
Japan Stock Futures Drop as French Socialist Wins Poll
May 6, 2012
Japanese and Australian stock futures fell amid growing concern over Europe’s debt crisis after Socialist Francois Hollande was elected president of France and Greek voters flocked to anti-bailout parties. American depositary receipts of Nissan Motor Co
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Japanese and Australian stock futures fell amid growing concern over Europe’s debt crisis after Socialist Francois Hollande was elected president of France and Greek voters flocked to anti-bailout parties.
American depositary receipts of Nissan Motor Co. (7201), a carmaker that gets almost 80 percent of its revenue overseas, sank 3.4 percent from the closing share price in Tokyo. Those of Canon Inc. (7751), a camera maker that depends on Europe for almost a third of its sales, lost 2.2 percent after the euro fell against the yen, cutting the exporter’s earnings outlook. ADRs of BHP Billiton Ltd. (BHP), the world’s No. 1 mining company, slid 1.7 percent after prices for oil and metals slipped.
Futures on Japan’s Nikkei 225 Stock Average expiring in June closed at 9,150 in Chicago on May 4, down from 9,220 in Singapore. Japanese markets were closed on May 3 and 4 for national holidays. They were bid in the pre-market at 9,140 in Osaka at 8:05 a.m. local time. Futures on Australia’s S&P/ASX 200 Index lost 1.2 percent today. New Zealand’s NZX 50 Index fell 0.2 percent in Wellington.
“There’s concern that the European debt problem may get serious. The euro is being sold in the currency market and that’s negative for Japanese stocks,” said Toshiyuki Kanayama, a market analyst at Tokyo-based Monex Inc. “In the U.S., the job recovery is getting sluggish, fueling concern that may have a bad impact on consumer spending and housing markets.”
U.S. Employment
Futures on the Standard & Poor’s 500 Index (SPX) fell 1.1 percent today. The index sank 1.6 percent in New York on May 4 after a report showed payrolls climbed 115,000 in April, the smallest gain in six months and below economists’ estimates for a 160,000 advance. The jobless rate unexpectedly fell to a three-year low of 8.1 percent as people left the labor force. Concern about Europe’s debt crisis also pushed stocks lower as services and manufacturing output in the euro region shrank.
The euro fell to its lowest level against the yen in almost three months low as Socialist Hollande was elected president and Greek voters flocked to anti-bailout parties, stoking concern austerity efforts in Europe may be derailed.
The euro weakened to as low as 103.24 yen today in Tokyo, compared with 106.20 yen at the close of stock trading on May 2. The dollar also depreciated to 79.67 yen from 80.37 yen, cutting the value of some overseas income at Japanese companies when repatriated.
Crude Below $100
Oil fell below $100 a barrel for the first time since February. Crude oil for June delivery sank 4 percent to $98.49 a barrel in New York on May 4, the lowest settlement since Feb. 7.
The London Metal Exchange Index of prices for six industrial metals including copper and aluminum fell 0.4 percent on May 4. The Thomson Reuters/Jefferies CRB Index of raw materials slipped 1.4 percent.
The MSCI Asia Pacific Index (MXAP) gained 9 percent this year through May 4, compared with an 8.9 percent advance by the S&P 500 and a 3.5 percent increase by the Stoxx Europe 600 Index. Stocks in the Asian benchmark are valued at 1.3 times book value, compared with 2.2 times for the S&P 500 and 1.4 times for the Stoxx 600, according to data compiled by Bloomberg. A number below 1 means companies can be bought for less than value of their assets.
To contact the reporters on this story: Norie Kuboyama in Tokyo at nkuboyama@bloomberg.net; Satoshi Kawano in Tokyo at skawano1@bloomberg.net
To contact the editor responsible for this story: John McCluskey at j.mccluskey@bloomberg.net
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Alcoholic Spray Promises a Few Seconds of Instant Intoxication [VIDEO]
May 5, 2012
By Joann Pan | Mashable – The product featured in the above video may be the perfect accessory for a Saturday night. Meet the “Spray That Makes You Drunk” — WA|AH Quantum Sensations — created by scientist David Edwards and designer Philippe Starck
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By Joann Pan | Mashable –
The product featured in the above video may be the perfect accessory for a Saturday night. Meet the “Spray That Makes You Drunk” — WA|AH Quantum Sensations — created by scientist David Edwards and designer Philippe Starck.
[More from Mashable: 10 Most-Shared Star Wars-Themed Ads on YouTube]
The WA|AH spray lets users skip breakfast, lunch and dinner and go straight to drinking. The product promises the short-term effects of alcohol — without the hangover or embarrassing moments. The new gadget premiered at a Paris exhibition recently and will hit store shelves in Europe soon.
The small lipstick-sized metallic canister holds around 2 milliliters of alcohol — 1000 times less than a cocktail, says the Daily Mail.
[More from Mashable: 9 Star Wars Tech Accessories From a Galaxy Far, Far Away]
But, the spray’s creators say the “shock is immediate, like a sensorial alarm.”
The spray will cost 20 Euros or around $26 a vial.
Would you spend $26 on the alcoholic spray? Sound off in the comments.
This story originally published on Mashable here.
Wall Street Week Ahead: All eyes on European elections
May 4, 2012
[unable to retrieve full-text content]NEW YORK (Reuters) – After Wall Street ended its worst week of the year on Friday, U.S. stock investors will look across the Atlantic next week to take their cue from Europe as France and Greece go to the polls
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[unable to retrieve full-text content]NEW YORK (Reuters) – After Wall Street ended its worst week of the year on Friday, U.S. stock investors will look across the Atlantic next week to take their cue from Europe as France and Greece go to the polls. That could offer some respite from a string of weak U.S. economic data and the earnings season winding down. Markets worldwide have closely watched developments in Europe for the past …
Hiring slowdown sends the stock market reeling
May 4, 2012
By PALLAVI GOGOI | Associated Press – NEW YORK (AP) — Stocks plunged Friday after the government reported that hiring slowed sharply last month. The report confirmed investors’ fears that the U.S. economic recovery may be faltering.
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By PALLAVI GOGOI | Associated Press –
NEW YORK (AP) — Stocks plunged Friday after the government reported that hiring slowed sharply last month. The report confirmed investors’ fears that the U.S. economic recovery may be faltering.
The losses in the market were widespread. The Dow Jones industrial average lost 168 points and the Nasdaq composite had its worst day since Nov. 9. Both the Nasdaq and the Standard & Poor’s 500 index closed out their worst weeks of the year. The Dow had its second-worst.
The dollar and U.S. Treasury prices rose as investors dumped risky assets and moved money into lower-risk investments. Energy stocks were among the hardest hit after the price of oil fell below $100 a barrel for the first time since February. Only one of the 10 industry groups in the S&P 500 rose, utilities, which investors tend to buy when they’re nervous about the economy.
“The jobs numbers were a disappointment,” said Phil Orlando, chief equity strategist at Federated Investors.
It was the third straight daily loss for the Dow, but it’s too early to know if it’s the start of a correction in the market. Even after its 1.4 percent decline this week, the Dow is still up 6.7 percent this year.
Investors are on edge about Europe once again as France and Greece both hold elections over the weekend. In France the socialist candidate Francois Hollande has a chance to unseat the incumbent Nicolas Sarkozy, who has been at the forefront of fashioning Europe’s efforts to prevent its share currency from collapsing.
Crude oil plunged $4 to $98.49 a barrel on worries that demand would drop because of a weakening world economy. It was the first time oil has dropped below $100 since February 13.
The late slump in the week was a stark contrast to Monday, when the Dow closed at its highest level in more than four years, propelled by a report that showed a pickup in manufacturing. All that became a distant memory after a slew of poor economic reports were released the rest of the week.
On Thursday major retailers including Costco and Macy’s reported that April sales inched up less that 1 percent, the worst performance since 2009. Thursday also brought news that U.S. service companies expanded their business more slowly in April.
The Dow closed down 168.32 points, or 1.3 percent, at 13,038. All 30 companies that make up the index fell, led by Bank of America and Cisco.
The S&P 500 fell 22.47 points, or 1.6 percent, to 1,369, while the Nasdaq index fell 67.96 points, or 2.2 percent, to 2,956.
For the week, the S&P lost 2.4 percent, the Nasdaq 3.7 percent.
The yield on the benchmark 10-year Treasury note dropped to 1.88 percent from 1.92 percent late Thursday as demand increased for safe investments. The yield hasn’t settled that low since early February.
The culprit for the distress in financial markets was a report from the Labor Department Friday showing that U.S. job growth slumped in April for a second straight month. The 115,000 jobs added in April and the 154,000 in March were down form an average of 252,000 a month from December through February.
Orlando noted that the first few months of the year were marked by a number of abnormal conditions including an uncharacteristically warm January and February. That led to a spurt in hiring which usually occurs in spring.
Retail sales and hiring were also affected by an earlier Easter, which fell on April 8 this year, 16 days earlier than last year. That pushed some retail sales ahead to March, leaving April’s numbers weaker than they might have been. Retailers also blamed a late Mother’s Day for pushing some sales out of April and into May. Unusually warm weather in February and March also pulled forward some sales that would have normally occurred in April.
“The surge in hiring and spending that usually occurs in March through April, occurred earlier in the year this year,” said Orlando. “We have to wait for economic numbers from May and June to get a better idea of the underlying strength of this economy.”
After the price of oil fell, energy company stocks turned lower in response. Southwestern Energy Co. fell 7 percent and Marathon Oil Corp. fell 3 percent.
In other trading:
— Warnaco Group Inc. dropped over 6 percent after the clothing maker lowered its 2012 forecast and said that its first-quarter net income fell, hurt by the weak European economy.
— Aon Corp. fell almost 6 percent after the insurance broker reported first-quarter net income fell 3 percent due to higher costs and unfavorable currency exchange rates.
— LinkedIn Corp. rose 7 percent after announcing late Thursday that its first-quarter profit more than doubled, topping expectations. The social networking company also announced an acquisition.
— Tilly’s Inc. climbed 8 percent in the clothing retailer’s debut on the New York Stock Exchange. Tilly’s sells surf-inspired and casual West Coast-styled clothing and accessories.
— Einstein Noah Restaurant Group Inc. soared 19 percent after the owner of bagel chain Noah’s Bagels said it is considering strategic alternatives, including a possible sale of the company
.
Global stocks, oil slump on weak jobs data
May 4, 2012
By Herbert Lash | Reuters – NEW YORK (Reuters) – Global stocks swooned and crude oil tumbled on Friday after a weak U.S. jobs report and data that suggested a deeper recession across the euro zone than previously thought dented sentiment. Major U.S
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By Herbert Lash | Reuters –
NEW YORK (Reuters) – Global stocks swooned and crude oil tumbled on Friday after a weak U.S. jobs report and data that suggested a deeper recession across the euro zone than previously thought dented sentiment.
Major U.S. and European stock indexes fell more than 1 percent, U.S. crude oil slumped about 4 percent and government debt prices jumped after the Labor Department said American employers reduced hiring more than expected in April.
The week was the worst this year for Wall Street stocks, with energy leading the decline. The S&P energy index of 44 gas and oil-related companies fell 2.2 percent on fears a worsening economy would sap demand.
“We have broken through key technical levels here after a disappointing employment report and the PMI number from Europe which suggest that the recovery is stalling and could affect energy consumption,” said Gene McGillian of Tradition Energy.
Just 115,000 workers were added to payrolls last month, or 55,000 less than economists expected. While the unemployment rate fell one-tenth of a point to 8.1 percent, a three-year low, that was only because the workforce shrank as people retired or stopped seeking work.
The third straight monthly decline in hiring growth spurred concerns that the U.S. economy is losing momentum and doused hopes that a stretch of strong winter hiring had signaled a turning point for the U.S. recovery.
The Dow Jones industrial average closed down 168.32 points, or 1.27 percent, at 13,038.27. The Standard & Poor’s 500 Index fell 22.47 points, or 1.61 percent, at 1,369.10. The Nasdaq Composite Index slid 67.96 points, or 2.25 percent, at 2,956.34.
The U.S. jobs data added to the gloomy tone from Europe, where purchasing managers’ indexes, primarily covering services, suggested a recession across the euro zone could extend to mid-year and be deeper than previously imagined.
Markit’s Eurozone Services PMI, which gauges business activity over a month, came in at 46.9 for April, sharply lower than 49.2 in March. Anything below 50 signifies contraction.
The JPMorgan Global Purchasing All-Industry Output Index of about 20 countries showed declines in April from March.
In Europe, the pan-European FTSEurofirst 300 index closed down 1.7 percent at 1,027.15, and the Euro STOXX 50 index fell 1.7 percent to 2,248.34 despite strong earnings from Royal Bank of Scotland
MSCI’s all-country world equity index fell 1.5 percent to 321.72.
Benchmark Brent crude in London fell to three-month lows around $113 a barrel, its steepest weekly fall since December, after the weak jobs report. Brent’s slide took three-day losses to more than 5 percent.
While the downbeat data weighed, traders said a combination of less-definitive factors – from confusion over margin changes to the breach of the 200-day moving average – compounded selling.
Brent futures settled down $2.90 at $113.18 a barrel, lows last seen in early February.
U.S. crude settled down $4.05 at $98.49 a barrel.
Some analysts said the jobs report, which followed weaker-than-expected services sector data this week, will fuel hopes for a third round of stimulus, or quantitative easing, by the Federal Reserve to keep rates low and to foster growth.
“The data in the U.S. is weakening somewhat. It puts into play that if the economy in the U.S. continues to weaken then QE3 will be on the table, so there are really no sellers of Treasuries,” said Charles Comiskey, head of Treasuries trading at Bank of Nova Scotia in New York.
The benchmark 10-year U.S. Treasury note rose 16/32 in price to yield 1.88 percent, and the 30-year U.S. Treasury bond gained almost a full point in price to yield 3.07 percent.
Gold rose as the weak data boosted bullion’s investment appeal on talk that a weaker economy might prompt further monetary easing by the Fed.
U.S. gold futures for June delivery settled up $10.40 an ounce at $1,645.20.
The dollar slipped against the yen in volatile trading after the payrolls number, with the U.S. currency down 0.45 percent at 79.83 yen.
The U.S. dollar index rose 0.33 percent at 79.481.
The euro was down 0.47 percent at $1.3088.
(Additional reporting by Richard Leong, Ryan Vlastelica, Julie Haviv, Matthew Robinson and Jonathan Leff, Reporting by Herbert Lash, Editing by James Dalgleish and Dan Grebler)
