NEW YORK (AP) — U.S. stocks fell in mid-morning Friday, after a solid jobs report kept alive the possibly that the Federal Reserve will raise interest rates as soon as next month.
Bonds with shorter maturities rose sharply.
KEEPING SCORE: The Dow Jones industrial average lost 99 points, or 0.6 percent, to 17,318 as of 11:10 a.m. Eastern. The Standard & Poor’s 500 index lost nine points, or 0.5 percent, to 2,073 and the Nasdaq composite fell 26 points, or 0.6 percent, to 5,029.
US JOBS: U.S. employers added a solid 215,000 jobs in July, signaling a steadily rising job market and providing a key piece of data for the Fed in its assessment of whether the economy can withstand higher interest rates.
While the number was slightly below the 225,000 jobs Wall Street economists were looking for, it was still good enough to show that the U.S. economy continues to improve.
“This is another solid report that, in our view, meets the criteria for ‘some further improvement’ in labor market conditions and thus will keep the Fed in play in September,” said Michelle Girard, an economist at RBS, in a note.
Fed policy makers have held rates at close to zero for more than six years to stimulate the economy after the Great Recession.
BONDS AND CURRENCIES: Shorter-maturity Treasurys reacted the most to the jobs report. The yield on the three-year note jumped from 1.04 percent to as high as 1.10 percent. The two-year note jumped from 0.69 percent to as high as 0.75 percent.
Shorter-dated Treasuries would be more impacted by the Fed raising rates, because of their shorter maturity and lower yield.
Longer-dated government bonds rose slightly. The yield on the 10-year Treasury note fell to 2.19 percent from 2.23 percent on Thursday.
The U.S. dollar rose initially rose against other currencies as traders anticipated higher rates, before giving up its gains. The euro rose 0.1 percent to $1.094, and the dollar fell 0.3 percent to 124.34 yen.
HIGH-DEFINITION: Nvidia, a maker of computer graphics cards, jumped after it said sales of its high-end products jumped from last year. The company’s stock gained $2.10, or 10 percent, to $22.55.
EUROPE AND ASIA: European stocks remained mostly lower after the jobs data. Germany’s DAX fell 0.7 percent, France’s CAC-40 lost 0.6 percent, and the U.K.’s FTSE 100 lost 0.3 percent.
The Shanghai Composite Index rose 2.3 percent, while Hong Kong’s Hang Seng gained 0.7 percent.
ENERGY: Benchmark U.S. oil fell 36 cents to $44.30 a barrel on the New York Mercantile Exchange.
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