Stock Market Close: Stocks Fractionally Mixed On US Jobs Report

Investors showed muted optimism Friday on a positive but lackluster jobs report, word China planned to inject $126 billion in stimulus into its economy and comments from U.S. Federal Reserve Chairman Jerome Powell indicating he sees no immediate signs of recession.

The Dow Jones Industrial Average closed up 69.92 points or 0.26% while the S&P 500 added 2.72 points or 0.09%. Late word that eight states and the District of Columbia were initiating an investigation into Facebook (FB) weighed heavily on the Nasdaq reversing earlier gains. The tech-heavy index closed down 13.75 points or 0.17%.

The Labor Department’s Bureau of Labor Statistics reported nonfarm payrolls rose by 130,000 in August, leaving the unemployment rate unchanged at 3.7% for the third straight month. Employment in the federal government also rose, largely reflecting hiring for the 2020 Census.

The increase was 20,000 jobs short of the forecast and way off from ADP’s report Thursday, which found 195,000 private-sector jobs added.

The number of those employed was virtually unchanged at 6 million while the long-term unemployed, 1.2 million, accounted for 20.6% of all those out of work. The jobs numbers for June and July were revised downward by 15,000 and 5,000, respectively.

The numbers added to investors unease about the economy.

“We had enough in the jobs report to back you away from recession fears, but it wasn’t too hot either,” Jim Paulsen, chief investment strategist at the Leuthold Group, told the Wall Street Journal. However, “it still very much allows the Fed to cut rates.”

Powell told an economic forum in Zurich he does not see any signs of recession in the near future and pledged the central bank would do what was necessary to keep the economy on track. He stopped short, however, of confirming the Federal Open Markets Committee would lower interest rates at its Sept. 17-18 meeting.

China’s central bank announced it would cut reserve requirements for banks, freeing up 900 billion yuan in a signal Beijing is increasingly worried about the slowing economy, which has been exacerbated by the trade war with the U.S. The state-run Xinhua news agency said the decision would “bolster the economy” by freeing up funds for lending to small businesses.

The move followed word Thursday a new round of high-level trade talks with Washington would begin in early October with preliminary discussions to commence in mid-September.

In Europe, the UK FTSE 100 was virtually unchanged at the close, up 0.04% . The German DAX was up 0.46% and the French CAC was up 0.13%.

Top gainers were Endo International PLC (ENDP), Microbot Medical Inc. (MBOT) and Pier 1 Imports Inc. (PIR). Top losers were Domo Inc. CIB (DOMO), Avid Bioservices Inc. (CDMO) and PhaseVio Pharmaceuticals Inc. (PHAS).

The British pound was off 0.3% against the dollar.

Crude oil futures were up 0.5% while gold was off 0.7% and silver fell 3.47%.