Wall Street slips after jobs report surprises
The S&P 500 and Nasdaq closed lower on Friday after touching record highs during the session, with high-flying chip stocks going into reverse and a mixed labor market report that showed more new jobs than expected with a rising unemployment rate. The S&P and Nasdaq briefly hit intraday record highs but started to lose steam late morning. Artificial intelligence chip darling Nvidia closed down 5.6 percent to snap a six-session winning streak. Early in the session it had been up more than 5 percent. In the chip index, Broadcom sank 7 percent after its full-year forecast failed to impress investors and Marvell Technology tumbled 11.4 percent after it forecast first-quarter results below market expectations on soft demand. Stocks had opened higher after data showed US job growth accelerated in February, with nonfarm payrolls increasing by 275,000 jobs against an expected 200,000 rise. January jobs numbers were revised lower. Also, the unemployment rate rose to 3.9 percent in February after holding at 3.7 percent for three straight months, while wage growth slowed to 0.1 percent on a monthly basis. "Today is just profit taking," said Brian Price, head of investment management for Commonwealth Financial Network who described the week as "a microcosm of the year so far" with modest pull backs and buyers stepping in. Price pointed to some signs of consumers spending more cautiously, with Costco Wholesale shares closing down 7.6 percent as quarterly sales fell short of estimates due to tepid demand for higher-margin goods. But Price said "the general bias right now is for the market to continue to move higher, absent negative catalysts." "That's really what the market is hanging its hat on right now, that inflation is going to continue to be benign, that the Fed is going to start to ease." Next week's February data including consumer prices (CPI) and retail sales will offer more cues on the prospects for potential rate cuts. The Dow Jones Industrial Average fell 0.18 percent, to 38,723, the S&P 500 lost 0.65 percent, to 5,124 and the Nasdaq Composite lost 1.16 percent, to 16,085. On the bright side, Gap shares finished up 8.2 percent after the retailer beat Wall Street expectations for fourth-quarter results, buoyed by strong demand on improved product offerings at its Old Navy and namesake brands during the holiday season, and lower markdowns. (Reuters)