"Horrible" Jobs Report Drives Dow Down 275
A bad day on the market with the Dow dropping 275 after this morning's bad jobs number for May.
Stocks dropped sharply today, with the Dow Jones Industrial Average ($INDU -2.22%) going negative for the year, after the Labor Department said the national unemployment rate rose to 8.2% in May and payroll employment growth fell dramatically.
The economy created just 69,000 new jobs in May, down from 77,000 in April and 143,000 in March. The payroll gains were much less than the consensus estimate of 150,000. Worse, the payroll gains for April and March were cut by a total of 49,000 jobs. In a note to clients, Ian Shepherdson, chief U.S. economist of High Frequency Economics, summed up the report in three words: "This is horrible."
There was renewed speculation that the Federal Reserve might try new measures to stimulate the economy, although Chairman Ben Bernanke and others have said they wouldn't move unless the economy shows truly serious deterioration.
It's questionable if today's jobs report meets that standard. The Institute for Supply Management's May index on manufacturing missed estimates slightly but suggested more strength in the economy than the jobs reports indicates. Automakers were reporting decent May sales, although the results were generally below Wall Street estimates.