Stocks plummet after disappointing jobs, manufacturing reports
Stocks tanked Friday morning amid a host of sour economic news that showed slower-than-expected job growth and manufacturing.
The Dow Jones industrial average plunged more than 200 points, down 1.6% to 12,188.8 in morning trading in New York, erasing its gains for the year after the two reports were released.
Standard & Poor’s 500 index was down 25 points, or nearly 2%, to 1,285.2. Nasdaq saw a 58-point slide, down 2% to 2,769.8.
The first piece of bad news came when the Labor Department said employers added just 69,000 jobs in May, less than half of what analysts were anticipating and the smallest gain in a year. The unemployment rate rose for the first time in nearly a year, to 8.2% in May.
Then the Institute for Supply Management said its index of American factory activity came in under expectations, dipping to a level of 53.5 in May from 54.8 in April.
On the plus side, the group’s index for new orders showed a 13-month high. The Commerce Department showed construction spending rising. Though personal income growth lagged, consumer spending was up, according to the department.
But investors were spooked nonetheless. They fled to the safety of U.S. government bonds and gold. Treasury prices soared, sending bond yields down to record lows. The price of the safe-haven precious metal jumped 3% to a morning high of $1,616.80 per ounce after falling in recent weeks to the mid-$1,500s.
June gloom indeed.
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