NYSE plummets amid weak jobs growth: Morning market insights

The New York Stock Exchange fell overnight after the weakest US monthly jobs report since September. Only 119,000 new jobs were added to the private, non-farm sector in April, according to the report. The news sent the US stock market down sharply, before recovering to finish with small losses.

The payrolls-processing company, Automatic Data Processing (ADP) said the best hiring was in the service sector and among small and medium businesses.

“The labour market is weak at best,” Keith Wirtz told Bloomberg.

Wirtz oversees $US15 billion ($AUS14.5 billion) as chief investment officer for Fifth Third Asset Management in Cincinnati.

“While we thought that we were gaining some momentum, more recent data suggests that things are sluggish. If we start to see a cascade of negative news, the market is going to be vulnerable.”

The S&P500 Index fell 0.25% to 1402.31 overnight AEST.

The Dow Jones Industrial Average was also down 0.08% or 10.75 points to 13268.60.

The NASDAQ Index gained 0.31% or 9.41 points to 3059.85.

The US commerce department said factory orders fell 1.5% in March, the biggest decline in three years.

TripAdvisor (TRIP) gained 17% overnight to $42.63, the biggest gain in the S&P 500. The online travel service was spun off from Expedia.com. It reported better than expected first-quarter profits and sales.

Banks, insurers and other financial companies posted this year’s biggest gain among the NYSE S&P 500’s 10 main industry groups. The financial industry index has risen 20% this year, beating the second best performing sector– technology stocks, which have gained 19%.

West Texas Intermediate (WTI) oil price rose 0.15% to $US105.37 a barrel overnight.

Gold was flat, down only 0.02% to be trading at $US1653.60 an ounce.

The Australian dollar was up overnight buying $US1.0325 at 8.30am AEST.

Europe

European sharemarkets finished mostly down after reports euro-region unemployment rose to a 15-year high. The jobless rate in the euro area rose to 10.9% in March, manufacturing contracted last month and unemployment even rose in Germany.

The London FTSE 100 closed down 0.93% to 5758.11, while the German DAX was also down 0.75% or 50.42 points to 6710.77. The Paris CAC 40 was up 0.43% to 3226.33. The European Stoxx50 index lost 0.71% to 2290.31.

Twelve European countries are officially in recession—recording two quarters of negative GDP growth.

Germany, the fourth biggest economy globally, and the largest in Europe could be next. Its economy shrank 0.2% in the last three months of 2011, and is expected to show another contraction when it releases data for the first quarter in May.

“It’s quite likely the German economy also contracted at very modest pace in the first quarter, which would technically fulfill the recession criteria,” Christian Schulz told CNN Money.

Schulz is a London-based economist at Berenberg Bank, the oldest private bank in Germany.

The slowdown in the euro-zone has taken a toll on Germany’s export-orientated economy.

“We’re learning just how bad austerity is during an economic downturn,” Hans-Joachim Voth, a professor of finance at Universitat Pompeu Fabra in Barcelona told CNN Money.

Voth does not expect domestic consumption in Germany to offset declining exports: “Germans are very bad at having a party,” Voth said, alluding to their frugality.