Job Losses and Nil Growth Bring Down US Stocks

Economic downturn

Job Losses and Nil Growth Bring Down US Stocks

US stocks took a tumultuous ride on Friday as investors became aware of the latest news that job growth around the country was once again very disappointing.

Overall the markets did end the week on slightly positive ground up 2.16% for the year-to-date. The economic gloom continues to batter investor confidence, especially with the riskier stocks.

The Industrial, energy and financial stocks bore the majority of sell offs. These types of stocks rely heavily on consumer spending for their financial gains and as such are still in decline following the trend set by the jobs sector. While most financial stocks took a hammering and weakened, insurance giant AIG gained 2.6% and bucked the trend.

Investors are now widely anticipating that the U.S. Federal Reserve will take further measures to stimulate the economy at its meeting next week. These financial stimulus packages have a two fold effect in not only helping consumer confidence and therefore job growth, but also assisting in raising investor confidence and market growth.

Better than expected corporate quarterly reports that had been initially driving the financial markets to new positive ground melted away on Friday to the breaking news of negative job data.

Gold prices rose once again as investors quickly moved into the safer precious metals sector.  This influx of nervous investors saw gold rise above the psychological benchmark of $1200.

The U.S. dollar was also weakened through the breaking jobs data report, hitting a 2010 low. The European markets which were already described as being in a fragile state after earlier gains, followed suit and closed down with the breaking US jobs news.

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Posted by on Aug 6 2010. Filed under Business, Featured News. You can follow any responses to this entry through the RSS 2.0. You can leave a response or trackback to this entry

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