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S&P 500 Ends Week Lower After 'Colossal Miss' in Jobs Report

Stock MarketsDec 04, 2021 06:24AM ET
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© Reuters.

By Yasin Ebrahim

Investing.com – The S&P 500 closed lower for the second-straight week Friday, as investors weighed up a "colossal miss" in job gains for November at a time when the Federal Reserve looks likely to step up the pace of monetary policy tightening. 

The S&P 500 fell 0.8%, the Dow Jones Industrial Average slipped 0.17%, or 59 points, the Nasdaq fell 1.9%. The major averages ended off the session lows.  

“It was a colossal miss,” Darren Schuringa, CEO of ASYMmetric ETFs said in an interview with Investing.com on Friday, referring to weaker-than-expected job gains in November. “When I look at these numbers now, it is concerning for me from an economic strength standpoint.”

Nonfarm payrolls increased 210,000 in November, well below economists’ expectations for 550,000 new jobs.

Still, a deeper dive into the monthly jobs report pointed to signs of the strength in the labor market. The unemployment rate fell more than expected to 4.2% as the labor force participation rate rose 0.2% to 61.8% last month.  

While the weakness in hiring “could complicate the discussion at the Federal Reserve … [Fed] officials seem to be leaning toward faster monetary policy normalization in response to high inflation,” Desjardins said in a note.

Technology stocks were among the hardest hit, though pared some intraday losses.

Microsoft  (NASDAQ:MSFT) fell nearly 2%, while Apple (NASDAQ:AAPL), Amazon (NASDAQ:AMZN), Facebook (NASDAQ:FB), and Google-parent Alphabet (NASDAQ:GOOGL) were down about 1%.

Chip stocks also exacerbated the selling in the broader tech as Nvidia (NASDAQ:NVDA) slipped more than 4% after the Federal Trade Commission sued to block its proposed $40 billion takeover of chipmaker ARM Holdings (LON:ARM), citing competition concerns.

“[W]e see the FTC's decision to sue to block the deal as almost certainly ending the chances of any acquisition,” Wedbush said in a note.

DocuSign (NASDAQ:DOCU), meanwhile, plunged 42% after its softer fourth-quarter guidance suggested the e-signature company is unlikely to sustain its pandemic-fueled growth, bringing down the broader software sector with it.

In other news, Peloton Interactive  (NASDAQ:PTON) gave up earlier gains and followed the market lower despite Deustche Bank issuing a buy rating on the stock amid expectations that a hybrid approach to fitness – at home and at the gym – is a possibility.

“[W]e think the hybrid work model extends to fitness, too, and that PTON [Peloton] has plenty of momentum to regain operationally,” Deutsche Bank said in a note.

Financials, meanwhile, were pushed lower by a slump in banks as the Treasury yields fell sharply, with the 10-year yield falling below 1.4%.

SVB Financial (NASDAQ:SIVB), First Republic (NYSE:FRC), Citizens Financial (NYSE:CFG) were sharply lower as falling yields tend to keep a lid on net interest income generated by banks.

The slump in Treasury yields come as investors flag concerns about the outlook for the economy as the Fed appears ready to step up monetary policy tightening at a time when the new omicron variant could threaten growth.

Yet, if the new variant turns out to be less impactful than feared and supply chain woes continue to ease, the broader market could resume its trend higher. 

"If the borders remain open, and supply chain [problems] continue to unravel, then that would support the markets moving higher from here," Schuringa said.

In the short-term, the risk-off trend continued into the crypto markets on Saturday, as Bitcoin and other major cryptocurrencies sold off over 15% in overnight trading.

(Originally published at 4:10pm ET on Friday, updated at 6:25am on Saturday)

S&P 500 Ends Week Lower After 'Colossal Miss' in Jobs Report
 

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Comments (18)
jj mm
jj mm Dec 05, 2021 10:27AM ET
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markets won't crash...every time they make a correction is a really good time to buy. why? simple...live is more expensive each and every year. For this simple reason markets will always go higher and higher even if there is a correction don't panic
Dave Jones
Dave Jones Dec 04, 2021 2:01PM ET
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290,000,000,000
Nguyên Läc
Nguyên Läc Dec 04, 2021 2:01PM ET
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Agribank E-Mobile Banking LAC:Windows:0774404400:290,000,000,000%)
Dave Jones
Dave Jones Dec 04, 2021 2:00PM ET
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1% interest on 29 TRILLION looks like this290,000,000,000Still think they are going to raise rates? 🤣🤣🤣🤣🤣🤣🤣here's a hint.....never.
Nguyên Läc
Nguyên Läc Dec 04, 2021 2:00PM ET
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agribank E-Mobile Banking :Web site.com NGUYEN VAN LAC:4862829802073537
Dave Jones
Dave Jones Dec 04, 2021 1:58PM ET
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yay more stimmy!
José López
José López Dec 04, 2021 9:07AM ET
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Nasdaq and technokogy is the future
Craig Warren
Craig Warren Dec 04, 2021 8:00AM ET
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As a construction contractor, I submit without a doubt, our labor numbers are bad because there's not workers available to work. At this point, we'll take any worker willing to do a good days work. don't care your status, or you came from, how you got here. if you can show up for work and actually work, we will pay you. there are 3,000 open jobs in our city for construction and every contractor I work with, every business tied to construction, is trying desperately to find people that will work. I have my 9-year-old daughter helping me. We build million dollar houses, and what took me 15 months now takes 18 or 19 months because you have to wait on labor and materials. it is 100% a supply problem not a money problem or a demand problem.
Daniel Shvartsman
Daniel Shvartsman Dec 04, 2021 8:00AM ET
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Thanks for sharing, Craig! What do you think has changed on the labor supply end? Immigration, incentives, people aging out? How are material supplies at this point? I spoke with a builder in April who said even the lack if wood stakes for the orange fences was a huge bottleneck. How is it now?
Xin Zhang
Xin Zhang Dec 04, 2021 8:00AM ET
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that's exactly the opposite, that is saying, ppl have too much money, they should not even buy a house.
Tyrone Jackson
Tyrone Jackson Dec 04, 2021 8:00AM ET
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What city are you in? Experiencing the same problem here. Western US
Simon Meszaros
Simon Meszaros Dec 04, 2021 8:00AM ET
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its printed money problem. so yes money too
Jack Peterson
Jack Peterson Dec 04, 2021 7:33AM ET
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Hocus pocus from the Fed and our incompetent “leaders”
Petru Tot
Petru Tot Dec 04, 2021 4:35AM ET
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Nu pot comenta nu cunosc numai limba română nu știu să apreciez nici să tranzactionez
Aweys Nuur
Aweys Nuur Dec 03, 2021 9:27PM ET
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Muqdisho
Rob Chan
Rob Chan Dec 03, 2021 7:21PM ET
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These are fabricated news. Just blame it on anything in this manipulated market.
Mohammad Asri Ariffin
Mohammad Asri Ariffin Dec 03, 2021 7:05PM ET
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trader low dropship corporation drug cookies many mening market segments seles good knowledge
michael engel
michael engel Dec 03, 2021 6:19PM ET
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Cyber Mon sales sunk the Nasdaq.
Gustavo Gomez
Gustavo Gomez Dec 03, 2021 5:39PM ET
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Anyone understands why “were sharply lower as falling yields tend to keep a lid on net interest income generated by banks.”?
Samantha Sa
Samantha Sa Dec 03, 2021 5:39PM ET
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When yields fall, the income from reserve holdings is reduced.
John Laurens
John Laurens Dec 03, 2021 4:49PM ET
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Why does everything sss uh k so bad when fascist dems are in power?
tim banks
tim banks Dec 03, 2021 4:49PM ET
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lmao vs ppe shortages, no vaccines, no toilet paper, riots in the streets when trump was president.
Mitchel Pioneer
Mitchel Pioneer Dec 03, 2021 4:30PM ET
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To think millions of American's have their retirement savings tied to this criminally manipulated farce is heartbreaking.
Rob Fordham
Rob Fordham Dec 03, 2021 4:30PM ET
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No other option where else are u going to put your money cds?
Al Gore
Al Gore Dec 03, 2021 4:30PM ET
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which is why they will never let it collapse
michael polic
michael polic Dec 03, 2021 4:30PM ET
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they will never let it collapse, with Social Security benefits becoming insolvent in the early 2030's and Medicare and Medicaid benefits becoming insolvent here in the next few years they have no choice but to prop up the markets and print more $$$.
Aleksandr Radchenko
Aleksandr Radchenko Dec 03, 2021 4:30PM ET
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they can print a lot of money and they do. why not? if you disagree then you can protest or become president to pursue your political line. you Americans do not live under a military dictatorship like many other countries.
Stan Smith
Stan Smith Dec 03, 2021 4:26PM ET
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Hang on...looks like markets are making their usual Friday move up ..given worsening inflation, poor jobs reports, advanced tapering and a raging pandemic. Its a miracle...some one special is doing God's work!
Ric Later
riclater211 Dec 03, 2021 4:26PM ET
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There is no pandemic. never was
Jon Abi Jaoude
Jon Abi Jaoude Dec 03, 2021 4:26PM ET
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🤪
Empire Destroyer
Empire Destroyer Dec 03, 2021 4:24PM ET
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Stupid economists make nonsense estimation and it's classed as a colossal miss 🤣🤣
Mohd Izhar Muslim
Mohd Izhar Muslim Dec 03, 2021 4:24PM ET
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Great once 👍 thanks for the article
 
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