US open: Stocks open lower following jobs data
By Iain Gilbert
Date: Friday 03 Apr 2020
(Sharecast News) - Wall Street stocks opened lower on Friday after data revealed that non-farm payrolls had collapsed throughout March.
As of 1550 BST, the Dow Jones Industrial Average was down 1.50% at 21,091.43, while the S&P 500 was 1.23% weaker at 2,495.87 and the Nasdaq Composite started out the session 1.13% softer at 7,402.35.
The Dow opened 322.01 points lower on Friday after rebounding oil prices offset nerves around a miserable jobless claims report and pushed stocks higher in the previous session.
The main focus for investors on Friday was news that the US jobs market deteriorated massively in March as the Covid-19 pandemic began sweeping across the country and some state authorities moved to a lockdown.
According to the Department of Labor, non-farm payrolls collapsed by 701,000 (consensus: -81,000), with travel & leisure accounting for the bulk of employment losses as companies in that sector shed 459,000 workers.
In parallel, the unemployment rate shot higher, from 3.5% for February to 4.4% in March (consensus: 3.8%).
With more than ten million Americans, roughly 3% of the population, signing up for unemployment in the last two weeks alone, Friday's jobs report was at the centre of attention for most investors.
Also in focus, crude oil futures extended the previous day's rally following reports that Russian oil producers were prepared to reduce their own output to help stem the rout in prices.
According to Bloomberg, which cited five people familiar with the situation, the Russian oil industry was ready to participate in production cuts alongside other producers and the fallout from the Covid-19 pandemic may force the Kremlin's hand.
Elsewhere, Donald Trump claimed overnight that the Covid-19 special committee launched by House Speaker Nancy Pelosi was simply an extension of the impeachment proceedings his administration survived just before the pandemic placed him under the spotlight again.
"Here we go again," Trump said at a White House news briefing. "Witch hunt after witch hunt after witch hunt."
Global cases of Covid-19 have topped one million, claiming 54,226 lives along the way. 245,380 cases have been recorded in the US.
Elsewhere on the macro front, IHS Markit's services PMI fell to 39.8 in March, down from 49.4 in February, indicating that economic activity in the service sector had contracted sharply during the month. The composite PMI fell to 40.9 in March from 49.6.
Lastly, US services and other non-manufacturing companies reported continued growth in March, however, it at came at the slowest pace since August 2016, according to the Institute for Supply Management. The ISM's services index was 52.5% in March after a 57.3% reading in the prior month.
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