Investors consider a 7th straight month of job losses, a huge miss from General Motors and climbing oil prices.
Stocks fell Friday morning as investors considered a seventh straight
month of job losses, a dismal second-quarter report from General Motors
and oil prices that jumped more than $4 in morning trading.
Employment report. The Labor Department reported a net loss of 51,000
jobs in July, which was not as many as expected. Economists had been
forecasting a loss of 75,000 jobs. Nevertheless, it was the seventh
straight month of job losses, bringing the 2008 loss to date to 463,000.
The unemployment rate rose to 5.7% from a 5.5% reading in June, which was worse than the 5.6% rate economists were looking for.
General Motors. The automaker reported a massive
second-quarter net loss of $15.5 billion, due in large part to
restructuring costs. Revenue fell to $37.7 billion from $45.8 billion a
year earlier, and far below analysts expectations of revenue of $44.6
billion. General Motors shares fell 8%.
Nissan. Japan's third-largest automaker reported that its
second-quarter profit fell 42.8% amid continued softening demand in the
United States. Nissan s revenue slipped 4.1% and the carmaker said that
the stronger yen cut into its exporting sales. Nissan's stock was down
by more than 5%.
Oil. After being down almost $2 earlier in the day, crude prices
surged at midmorning. They were up $2.85 to $126.93 a barrel in
electronic trading on the New York Mercantile Exchange. On Thursday,
oil fell $2.69.
COMEX gold for December delivery fell $3.70 to $919.00.
In the bond market, Treasury prices were mixed. The 10-year note was down, sending the yield up slightly to 3.96%.