US close: Stocks swing weaker in afternoon trading

dl wall street st new york city nyc nyse stock exchange ny dow jones nasdaq sp finance us usa united states of america — Wall StreetSharecast photo / Josh White

Wall Street stocks had swung to a negative close on Friday, having earlier jumped after the release of August's all-important nonfarm payrolls data.

At the close, the Dow Jones Industrial Average was down 1.07% at 31,318.44, as the S&P 500 also lost 1.07% to 3,924.26, and the Nasdaq Composite was off 1.31% at 11,630.86.

The Dow closed 337.98 points lower on Friday, reversing the gains it recorded late in Thursday’s session.

Friday's primary focus was last month's nonfarm payrolls report from the Bureau of Labor Statistics, which revealed hiring in the US came in slightly ahead of estimates, alongside increased labour force participation, although wage growth was a tad short of forecasts.

In seasonally-adjusted terms, non-farm payrolls grew by 315,000 in August, while economists had pencilled-in an increase of 300,000.

Figures for the prior two months were revised lower by a combined total of 105,000, while the rate of unemployment - derived from a separate survey to that for payrolls - moved up by two-tenths of a percentage point in comparison to the prior month to 3.7%.

"The slower pace of payroll gains in August, together with the big rebound in the labour force, and the more modest increase in wages, would seem to favour a smaller 50 basis point rate hike from the Fed next month, rather than a 75 basis point increase, but officials will put a lot more weight on August’s CPI data, due the week after next," said Michael Pearce, senior US economist at Capital Economics.

Elsewhere on the macro front, US factory orders slipped 1% month-on-month in July to $548.5bn, according to the Census Bureau, while June's increase was upwardly revised to show a 1.8% gain to $554.2bn.

In equities, Broadcom and Lululemon Athletica both rallied on the back of solid earnings, closing up a respective 1.67% and 6.7%.

On the downside, Starbucks Corporation lost 2.88% after it emerged that Laxman Narasimhan - who unexpectedly stepped down as head of Reckitt Benckiser earlier this week - would take over as CEO of the coffee shop giant next month.

Reporting by Josh White at Sharecast.com. Additional reporting by Iain Gilbert.

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