US stocks close down

Deepening investor pessimism over the US economy sent stocks lower on Wall Street today as oil moved past $53 per barrel.

The major indexes ended the week lower.

Investors saw the latest Labour Department report on employment as a sign that the US economy continued to struggle through a period of sluggish growth. Only 96,000 new jobs were created in September, far fewer than the 150,000 Wall Street had expected.

And the oil price added to concerns that the markets’ traditional fourth-quarter rally would be muted this year – if it arrives at all.

A barrel of crude oil set another record, settling at 53.31, up 64 cents, on the New York Mercantile Exchange.

“The jobs figure was clearly disappointing, and energy prices are still hanging in there,” said Scott Brown, senior economist at Raymond James. “It’s not a disaster, but the jobs number just isn’t good enough. The markets are taking it fairly well, considering, but it doesn’t help.”

The Dow Jones industrial average fell 70.20, or 0.7%, to 10,055.20.

Broader stock indicators were moderately lower. The Standard & Poor’s 500 index was down 8.51, or 0.8%, at 1,122.14, and the Nasdaq composite index dropped 28.55, or 1.5%, to 1,919.97.

For the week, the Dow dropped 1.35%, the S&P fell 0.83% and the Nasdaq was down 1.14%.

While the US unemployment rate remained at 5.4% for September, the Labour Department also revised August’s job creation figure downward, from the 144,000 initially reported to 128,000 – a disturbing trend for investors hoping for more job creation to further stimulate consumer spending.

The latest reading of The Associated Press-Ipsos consumer confidence index, released today, dropped to 97.4 in September, down from 103.4 in August.

Investors hoping for momentum from General Electric’s earnings were disappointed. GE slipped 21 cents to 33.74 after its earnings met Wall Street estimates. The conglomerate credited higher industrial sales and Olympic coverage on its NBC television subsidiary for an 11% rise in earnings.

Alcoa, the first Dow component to report third-quarter earnings, lost 68 cents to 33.40 after reporting profits of 34 cents a share, in line with Wall Street’s reduced expectations for the aluminium company. The company blamed the recent hurricanes and labour troubles for its minimal gains from a year ago.

Semiconductor maker Advanced Micro Devices met analysts’ forecast with earnings of 12 cents per share for the quarter, but its sales were slightly less than investors had hoped for. AMD slipped 61 cents to 13.50. Rival Intel skidded 69 cents to 20.55 ahead of its earnings report next week.

Krispy Kreme Doughnuts tumbled 56 cents to 12.51 after announcing that the US Securities and Exchange Commission has opened a formal investigation into the company’s operations.

Declining issues outnumbered advancers by about 5 to 4 on the New York Stock Exchange, where volume totalled 1.29 billion shares, compared with 1.45 billion on Thursday.

The Russell 2000 index of smaller companies was down 6.95, or 1.2%, at 575.65.