US open: Stocks mixed on weaker than expected non-farm payrolls
US equity markets were mixed on Friday in light of weaker-than-expected employment numbers, the first non-farm payrolls data released since the Federal Reserve hiked interest rates by 25 basis points.
The Dow Jones Industrial Average fell 0.17% to 19,865.27, the S&P 500 was down 0.08% to 2,267.27, but the Nasdaq was up 0.13% to 5,495.24 at 1452 GMT.
Meanwhile, oil prices slipped as Saudi Arabia and Abu Dhabi started to cut supply. West Texas Intermediate was down 0.16% to $53.67 a barrel and Brent crude was 0.4% weaker to $56.64.
“Could today’s non-farm payrolls miss send the Dow to 20k at long last?” asked Neil Wilson, chief market analyst at ETX Capital.
“It’s touch and go – US equities could receive that extra leg of support they need after the monthly US jobs report was little short of expectations, but the data doesn’t really alter the broader narrative that says the Fed is on track to raise rates three times in 2017”, he said.
Non-farm payrolls rose 156,000 in December, well below analysts' estimates of 178,000. November was revised up to 204,000 jobs from a previous 178,000.
Last month’s figure brings total job growth to 2.2m in 2016, compared to 2.7m in 2015.
The jobless rate edged up to 4.7% in December from 4.6% in November and the number of unemployed persons was little changed at 7.5m. However, November's decline in the unemployment rate to 4.6% from 4.9% the prior month was mainly due to a fall in the labour force.
Average hourly earnings rose an annualised 2.9% in December, ahead of a projected 2.8% increase and following a 2.5% gain a month earlier. On the month, earnings edged up 0.4% compared to forecasts of 0.3% growth and November's 0.1% decline.
The labour force participation rate held at 62.7% and was unchanged over the year.
Wilson said: “Jobs numbers missed their mark but this slight slip up alone is certainly not enough to stop the Fed from raising rates this year. The data is a little positive, a little negative. US bond yields and the dollar index both firmed having slipped a little over the last 24 hours, while stock futures turned higher.
“The numbers – the last for the Obama presidency - probably matter a lot less than what is about to come in the shape of Donald Trump’s economic policies and how these play out with the Fed’s monetary policy. Today’s non-farm payroll numbers won’t make a whole lot of difference to that, other than confirm that he is taking over with the employment market in good health.”
In currency markets, the dollar recovered from recent losses, trading up 0.76% against the pound to 0.8113, rose 0.88% versus the yen to 116.36, and was 0.39% higher versus the euro to 0.9465.
In corporate news, restaurant chain Ruby Tuesday tanked 23.23% after it said late on Thursday that second-quarter losses widened as revenue declined.
Amgen rose 4.15% after a US Federal judge ruled that Sanofi and Regeneron Pharmaceuticals had to take their competing cholesterol drug off the market as it infringed the company’s patent.
Wal-Mart fell 1.3% after the retail giant said than Sam’s Club CEO Rosalind Brewer is to retire from 1 February and will be replaced by John Furner.
Later in the day, Chicago Fed President Charles Evans is to speak in Zurich, Richmond Fed President Jeffrey Lacker in Baltimore and Dallas Fed President Rob Kaplan in Chicago.