Wall Street ends the week lower as the jobs report fades

NEW YORK, Sept 2 (Reuters) – U.S. stocks ended the trading week lower on Friday as early gains in a jobs report led to worries about the European gas crisis and showed the labor market was easing. .

Wall Street rose sharply after an August U.S. payrolls report showed stronger-than-expected hiring but the unemployment rate rose to 3.7%, easing some concerns about the Federal Reserve’s aggressiveness in raising interest rates as it tries to curb high inflation. .

However, profits were wiped out after Gazprom (GAZP.MM), the state-controlled company that has a monopoly on Russian gas exports to Europe via a pipeline that was due to restart on Saturday, said supplies could not be safely restarted until an oil leak found in a main turbine was repaired and replaced. Duration. read more

“The afternoon certainly overshadowed the good data from this morning and the afternoon was stolen from us by those headlines out of Europe,” said Zach Hill, head of portfolio management at Horizon Investments in Charlotte, North Carolina.

Analysts pointed to thin trading volumes ahead of the extended holiday weekend helping to exaggerate market moves.

“Setting is key, there’s been some optimism around the European energy situation in the past week, with long-term power prices almost halving in some cases, signs that Germany is almost 80% full of gas. So what we’re seeing is a small positioning adjustment against that backdrop and with less liquidity heading into the holiday weekend on Friday afternoon.” Hill said.

Dow Jones Industrial Average (.DJI) 337.98 points or 1.07% down to 31,318.44; S&P 500 (.SPX) lost 42.59 points or 1.07% to 3,924.26; and the Nasdaq Composite (.IXIC) 154.26 points or 1.31% down to 11,630.86.

Markets are closed on Monday for the Labor Day holiday.

Energy (.SPNY) The S&P was the only major sector to end the session in positive territory, up 1.81%.

While wages topped expectations, average hourly earnings rose 0.3% compared to 0.4%, while the unemployment rate rose to 3.7% from 3.5% before the pandemic, signaling the start of the central bank’s efforts to pre-load rate hikes. To come into effect. read more

The wage growth data is seen as key to the central bank’s discussions on raising interest rates as the central bank looks to bring inflation back to its 2% target, which has been running at a four-decade high. Expectations for a third straight 75 basis point hike by the central bank at its September meeting fell to 56%, according to CME. FedWatch toolDown 75% from the previous day.

Attention now shifts to the mid-month August consumer price report, the last key data available before the central bank’s Sept. 20-21 policy meeting.

Fears of aggressive policy tightening have weighed on stocks, along with the S&P 500, which hit a four-month high in mid-August. (.SPX) It has fallen about 7% since the day before Fed Chairman Jerome Powell’s hawkish comments about rate hikes last week. His comments were echoed by other policy makers.

All three major indexes posted their third straight weekly loss, with the Dow down 2.99%, the S&P 500 down 3.29% and the Nasdaq down 4.21%.

Volume in US equities was 9.95 billion shares compared to the full session’s average of 10.48 billion over the last 20 trading days.

Declining issues outnumber advancing issues by a 1.34-to-1 ratio on the NYSE; On the Nasdaq, a 1.65-to-1 ratio favored decliners.

The S&P 500 posted three new 52-week highs and 14 new lows; The Nasdaq composite posted 47 new highs and 184 new lows.

Report by Chuck Mikolajczak; Editing by Jonathan Otis

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