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US stock futures sink after June jobs report disappoints; indices falling from near 2011 highs
U.S. stock futures fell sharply Friday after the government said businesses added the fewest jobs in more than a year in June and the unemployment rate rose to 9.2 percent.
The economy generated a net 18,000 new jobs in June, and the number of jobs added in May was revised down to 25,000, the Labor Department said.
The news dashed hopes for a quick rebound from May's weak result, which was blamed on high fuel prices and the crises in Japan. Those problems appear to be more persistent than many analysts expected.
Before the opening bell, Dow Jones industrial average futures are down 106 points, or 0.8 percent, at 12,575. Standard & Poor's 500 futures are down 16, or 1.2 percent, at 1,336. Nasdaq 100 futures are down 21, or 0.9 percent, at 2,395
A string of weak economic data this spring had pushed stocks to near their 2011 lows two weeks ago. But the markets recovered after recent signals that the economy was rebounding.
Stocks rose Thursday after encouraging reports about hiring and consumer spending. Payroll processor ADP said that private companies added a net 157,000 new jobs last month, more than double what economists forecast. A separate government report showed that the number of people applying for unemployment benefits fell to a seven-week low. Major retailers reported their best June sales results since 1999, helped by deep discounts and warm weather.
The good news lifted major indices to near their highs for 2011. The Dow Jones industrial average rose 93 points to close at 12,719 Thursday. The Standard & Poor's 500 index rose 14, or 1.1 percent, to 1,353. The Nasdaq composite index rose 39 points to 2,873, just a point below its high for the year.
Futures trading after Friday's job report pointed to an early selloff that could erase those gains. Traders steeled themselves for the flood of second-quarter financial results that companies will release next week.