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Stocks: Investors unimpressed by jobs report

Friday, January 4, 2013 - 12:47pm

Stocks opened little changed Friday, following the government's monthly jobs report that showed hiring remained steady in December.

The Dow Jones industrial average and Nasdaq edged slightly lower, while the S&P 500 rose.

The Bureau of Labor Statistics reported a gain of 155,000 jobs last month, with the unemployment rate unchanged at 7.8%. The rate was originally reported as 7.7% in November, but that was revised up to 7.8% in the latest report.

Economists surveyed by Briefing.com were expecting 150,000 jobs to have been created in December, up from 146,000 in November.

Two other important reports on tap for Friday morning include factory orders and ISM data.

At 10 a.m. ET the Census Bureau will release data on November factory orders, followed by the Institute for Supply Management's monthly non-manufacturing index. Economists surveyed by Briefing.com expect that U.S. manufacturing expanded by a half of a percentage point two months ago, while the services sector -- which makes up the vast majority of the nation's economy -- grew at a somewhat slower pace in December.

Investors are also keeping close tabs on bonds. The yield on the 10-year Treasury has been steadily climbing closer to 2% -- a level not seen since April of last year. It's currently trading at 1.93%.

Considering the modest strength of Friday's jobs report, the 10-year yield could keep moving higher as investors dump out of Treasuries (yields move in opposite direction).

U.S. stocks closed slightly lower Thursday, after investors fretted that the Federal Reserve might end its intervention in the markets, colloquially known as "QE," sooner than expected. However, all major indexes are still up for the week.

European markets were mixed in afternoon trading, as concerns about the Fed's stance on further quantitative easing prompted some investors to take profits after recent strong gains.

Meanwhile, Asian markets ended mixed. Open for the first time this year, the Shanghai Composite added 0.4%, while the Nikkei advanced 2.8%. Hong Kong's Hang Seng declined 0.3%.

The dollar rose against major currencies including the euro, British pound and the Japanese yen. Oil and gold prices declined slightly.

 

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