Wall St. stumbles ahead of intense week
October 1, 2012, 12:12 am TWN
NEW YORK--U.S. stocks stumbled last week as investors focused on Spain's financial woes, but this week's jobs report and the first presidential debate should bring attention back home.
Over the past five sessions, the Dow Jones Industrial Average fell 1.05 percent, finishing Friday at 13.437,13 points.
The tech-rich Nasdaq gave up 2.00 percent at 3.116,23 points.
The Standard & Poor's 500, a broad measure of the markets, shed 1.33 percent at 1,440.67 points.
“Data this week was for the most part disappointing and gave little indication of the economy escaping its slow-growth trajectory any time soon,” said Wells Fargo Securities analysts last week.
While traders took the last trading day of September and the third quarter to rebalance their portfolios and book profits, worries about the eurozone's public debt crisis, and in particular Spain, cast a dark cloud over the markets.
Spain's announcement of a 2013 austerity budget Thursday pushed the indices into the only positive territory of the week.
But concerns about the credit rating of the fourth-largest eurozone economy overhung sentiment Friday after Spain reported bank stress test results.
Moody's rating agency said in June its review of Spain for a credit downgrade to junk status would likely “continue through the end of September.”
With the euphoria from the Federal Reserve's quantitative easing program long faded and questions rising about its effectiveness in stimulating growth in the tepid economy, investors will be focusing on the central bank's policy meeting minutes.
Due Wednesday, investors are expected to pore over the Federal Open Market Committee minutes of the September 12-13 meeting that yielded limitless bond purchases of US$40 billion a month to prop up the economy.
“The minutes could provide valuable insight into the Fed's decision to make its easing strategy open-ended instead of incremental, and to keep it in place until an improved jobs market outlook is achieved,” said economists Nigel Gault and Paul Edelstein at IHS Global Insight.
On Wednesday night, President Barack Obama and Republican rival Mitt Romney will square off for the first of three televised debates in a presidential election dominated by voters' economic worries.
Next week is chock-full of economic data, beginning with the Institute for Supply Management's purchasing managers index for September manufacturing Monday, followed by its PMI reading on services Wednesday.
Automakers report U.S. sales for September Tuesday.
Payrolls firm ADP releases employment figures Wednesday and the government gives its weekly report on initial unemployment claims on Thursday, a steady drumbeat of jobs news ahead of the keenly awaited September jobs report Friday.
The jobs report, the second to last before the Nov. 6 election, is expected to show unemployment held unchanged from July's 8.1 percent rate and job growth rose to a still-weak 120,000 from a paltry 96,000.