The Dow slipped into negative territory for the year amid a modest selloff Monday, reflecting Wall Street’s mixed reactions to an upbeat jobs report.
The Dow Jones Industrial Average (INDEXDJX:DJI) closed 82.9 points lower, or 0.5%, at 17766. The S&P 500 (INDEXSP:GSPC) fell 13.6 points, or 0.7%, to 2079. The Nasdaq (NASDAQ:IXIC) shed 46.8 points, or 0.9%, at 5021.
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The blue-chip index is now trading below its close of 17823 on Dec. 31.
Monday’s red ink comes on the heels of a 56-point loss for the Dow Friday, when the U.S. Labor Department said the economy added 280,000 jobs in May. The figure easily beat expectations for a gain of 225,000 jobs.
The unemployment rate ticked higher to 5.5% from 5.4% since 400,000 more people entered the workforce.
In another positive development, hourly wages grew 0.3% compared to the prior month and 2.3% year-over-year.
However, the strong data shifted Wall Street’s attention to a pending interest rate hike from the Federal Reserve.
“The read-through was [Friday’s jobs report] absolutely puts September on the table in terms of liftoff,” said Phil Orlando, chief equity strategist at Federated Investors, during a discussion on “Mornings with Maria.”
“I think the market is thinking back to the ‘taper tantrum’ back in the spring of 2013 when [former Fed chief Ben] Bernanke started going through the same process,” Orlando added.
Employment will be the key market driver moving forward, according to Abby Joseph Cohen, president of Goldman Sachs’ (NYSE:GS) Global Markets Institute. Also appearing on “Mornings with Maria,” Cohen highlighted stronger wages and an expanding labor market as catalysts for economic growth.
“All of that really is the background for why retail sales may pick up, or we may also see ongoing improvements in savings, and that’s fine, too,” Cohen explained.