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Stocks hold steady after dismal jobs report; energy climbs

Business

By STAN CHOE AP Business Writer

NEW YORK (AP) — Stocks are holding relatively steady on Wall Street in early trading Friday, even after a report showed the economy lost 701,000 jobs last month, the first drop in nearly a decade.

The government’s jobs report is usually the most anticipated economic release each month, but it didn’t pack much of a market punch because investors around the world were fully expecting to see astonishing losses. Treasury yields, European stocks and futures for U.S. stock indexes even cut their losses after the jobs report was released, which was before U.S. stock markets opened.

The major U.S. stock indexes were all close to flat in early morning trading. The S&P 500 dipped 0.1%, as of 9:52 a.m. Eastern time. The Dow Jones Industrial Average fell 75 points, or 0.4%, to 21,338, and the Nasdaq was down 0.1%.

Businesses have shut down across the country and the world as people stay home in hopes of slowing the spread of the coronavirus outbreak. Friday’s report likely doesn’t even fully capture the extent of the recent job losses, which have been accelerating by the day. Economists say next month’s report may show the economy has wiped away the last of the 22.8 million jobs created during its nearly decade-long hiring streak.

The S&P 500 is down 25% since its record set in February, reflecting the growing assumption that the economy is set to slide into a sudden, extremely sharp recession. Part of that decline also reflects the market’s expectations for stunning job losses, such as those included in Friday’s jobs report

But the panic selling that dominated the first few weeks of the sell-off has calmed a bit since Washington unleashed unprecedented amounts of aid to help markets and the economy. The Federal Reserve has promised to buy as many Treasury securities as it takes to keep lending markets running smoothly, and Congress approved a $2.2 trillion rescue plan for the economy.

Now, markets are waiting to see when the number of new coronavirus infections peaks. Only that can give some clarity on how long the economic downturn will last and how deep it will be.

The United States has more than 245,000 confirmed cases, which leads the worldwide tally of more than 1 million compiled by Johns Hopkins University.

For most people, the coronavirus causes mild or moderate symptoms, such as fever and cough. But for others, especially older adults and people with health problems, it can cause pneumonia and be fatal.

Markets got an additional lift Friday from another gain in oil prices.

Benchmark U.S. crude climbed 5% to $25.71 per barrel, adding on to its nearly 25% surge the prior day on expectations that Saudi Arabia and Russia may dial back their price war.

The world is awash in oil as demand for energy collapses, and President Donald Trump said the rivals may be close to cutting back on production to prop up oil’s price.

That helped energy stocks in the S&P 500 rise 1.7% Friday, adding on to Thursday’s 9.1% rally.