Stocks Sink As Wall Street Fears Downside Of Solid Jobs Data

US stocks are falling Friday as Wall Street focuses on the downside of the still-strong US jobs market, Stan Choe and Yuri Kageyama reported for the Associated Press (AP).

Photo Insert: The Nasdaq composite was 2.4% lower.

The S&P 500 was 1.5% lower in midday trading after a report showed employers hired more workers last month than economists expected.

While that’s a good sign for the economy amid worries about a possible recession, many investors saw it keeping the Federal Reserve on its path to hiking interest rates aggressively.

Such moves would slow the economy in hopes of ultimately knocking down high inflation, and the Fed risks causing a recession if it moves too quickly or too far. Higher interest rates put downward pressure on stocks and other investments.

The Dow Jones Industrial Average was down 286 points, or 0.9%, at 32,957, as of 11 a.m. Eastern time, and the Nasdaq composite was 2.4% lower.

Bitcoin also fell, while a measure of worry in the stock market rose, even though some glass-half-full signals for inflationary pressures were buried within the jobs data. It’s a reversal from Thursday’s market movements when a narrower report on the US jobs market came in weaker than expected.

That bolstered speculation the Fed may consider a pause in raising rates later this year, and the hopes for a less-aggressive Fed sent stocks jumping.

Friday’s more comprehensive report from the U.S. government showed employers added 390,000 jobs last month, better than expectations for 322,500.

That sent Treasury yields climbing, though they initially wobbled as investors moved from one knee-jerk reaction to another following the report’s release. The yield on the two-year Treasury, which tends to move with expectations for Fed action, rose to 2.67% from 2.62% just before the report’s release.

The 10-year yield, which tracks expectations for longer-term growth and inflation, rose to 2.96% from 2.91% after earlier climbing as high as 2.99%.

WEEKLY FEATURE : MVP Group Keeps Lights On During Pandemic