Published: Mon, February 05, 2018
Tech | By

Dow industrials drop 600 points, extending a weeklong slump

Dow industrials drop 600 points, extending a weeklong slump

The U.S. added 200,000 jobs during January versus the 190,000 expected, the U.S. Labor Department reported Friday.

The better-than-expected January employment report showed a surge in job growth and the largest wage gain in more than 8-1/2 years, fuelling expectations that rising inflation will prompt the Federal Reserve to hike interest rates more aggressively this year. That's 2.5 percent of its total, which makes it the biggest percentage drop since June 2016, when the Brexit decision rocked world markets.

"Armenpress" reports the value of Dow Jones down by 2.54% to 25520.96 points, S&P 500 down by 2.12% to 2762.13 points, Nasdaq down by 1.96% to 7240.95 points. The Nasdaq pulled back 5.4 percent the week of February 5. The index is still up more than 3 percent since the year began. And with the robust jobs report Friday showing the fastest wage growth in years, some think the pace of rate increases could quicken. Investors are anxious it could prompt the Federal Reserve to raise interest rates faster than expected.

BOND YIELDS: Bond prices declined again Friday.

"What's been bothering the market is the speed with which they're going up", analyst Patrick O'Hare said of higher Treasury yields.

This week yields hovered at their highest level since January 2014, fueled by the prospect of stronger economic growth in the US and overseas.

Sony, which recently posted stellar quarterly earnings, especially in its entertainment division, was the only major media conglomerate to trade higher on Friday, closing up 6 percent. That was the worst point drop since the blue-chip average fell 678.92 points on October 9, 2008, in the midst of the nation's financial crisis.

The Standard & Poor's 500 index gave up 49 points, or 1.8 percent, to 2,773. Amazon shares gained $63.78 to $1,453.78.

Gold futures and copper prices both decline.

US crude fell $1.02 to $64.78 per barrel and Brent fell $1.34 to $68.31.

Brent crude, used to price worldwide oils, fell 91 cents, or 1.3 percent, to $68.74 per barrel in London.

The dollar index, tracking the unit against a basket of major currencies, rose 0.72 per cent, with the euro down 0.64 per cent to $1.2428. Energy shares sank 4 percent as earnings disappointed and crude slumped.

In the S & P 100, Exxon also was the worst performer, followed closely by Google (-5.23% at 10:00 am).

Canada's main stock index also took it on the chin, sliding more than 250 points, down 4 per cent over the past week, in a broad-based decline that included drops in every sector. Germany's DAX slid 1.1 percent, while France's CAC 40 lost 1.1 percent.

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