U.S. stocks close lower after June jobs report

New York [US], July 8: U.S. stocks ended lower on Friday after new data showed a slowdown in job creation and persistent wage pressures in June.
The Dow Jones Industrial Average fell 187.38 points, or 0.55 percent, to 33,734.88. The S&P 500 lost 12.64 points, or 0.29 percent, to 4,398.95. The Nasdaq Composite Index declined 18.33 points, or 0.13 percent, to 13,660.72.
Six of the 11 primary S&P 500 sectors ended in red, with consumer staples and health leading the laggards by losing 1.34 percent and 1.16 percent, respectively. Meanwhile, energy and materials led the gainers by rising 2.06 percent and 0.88 percent, respectively.
U.S. stocks gave up earlier gains and finished lower on Friday, as investors weighed on the latest jobs data.
Nonfarm payrolls increased by 209,000 jobs last month, lower than market expectations of 240,000 jobs, marking the smallest gain since December 2020. Meanwhile, the unemployment rate edged down to 3.6 percent in June, from 3.7 percent in May, remaining historically low, according to the U.S. Bureau of Labor Statistics' closely watched June jobs report.
Although the U.S. economy added the fewest jobs in June in two-and-a-half years, persistently strong wage growth pointed to a still-tight labor market that raises fears of more rate hikes later this year.
Average hourly earnings rose by 0.4 percent in June and 4.4 percent from a year ago, indicating a stronger-than-expected and robust wage growth, according to the U.S. Bureau of Labor Statistics.
"It's kind of a mixed picture today," said Truist Co-Chief Investment Officer Keith Lerner, in an interview with CNBC. "It's good news that the economy is not falling apart, it's still chugging along, but you still have these wage pressures that are going to keep the Fed likely to raise rates at the end of the month."
The U.S. economy remains "too strong" for core inflation to quickly fall back to 2 percent, putting pressure on the Fed to keep hiking rates this year and potentially hold them there for longer than anticipated. Although job growth has been cooling and openings recently fell, wage growth seen in Friday's employment report points to households remaining in quite good shape, said SebVismara, global macro economist and strategist at BNY Mellon Investment Management, in an interview with MarketWatch.
The Federal Open Market Committee has around 92 percent probability to raise the benchmark interest rate by another 25 basis points at its July meeting, according to data from the CME FedWatch Tool on Friday afternoon.
Source: Xinhua