US stocks, dollar slide after weak jobs report

U.S. stocks moved lower in early trading Friday after a key government jobs report showed hiring slowed in May, a sign of economic weakness that could dissuade the Federal Reserve from raising interest rates this month. The dollar fell sharply against most major currencies, while bond prices surged as investors sought safety in U.S. government-backed debt. Financial and consumer stocks were down the most.

KEEPING SCORE: The Dow Jones industrial average fell 124 points, or 0.7 percent, to 17,715 as of 10:06 a.m. Eastern time. The Standard & Poor’s 500 index shed 14 points, or 0.7 percent, to 2,090. The Nasdaq composite index lost 52 points, or 1.1 percent, to 4,918.

US ECONOMY: The Labor Department reported that the U.S. economy added only 38,000 jobs in May, the lowest amount in five years. The unemployment rate fell to 4.7 percent from 5 percent, but mainly because about half a million unemployed people stopped looking for work. The report is likely to push the Federal Reserve to hold off raising its key interest rate this month.

FINANCIALS STUMBLE: Several banks and financial services companies fell amid speculation that the Fed will opt not to raise its benchmark interest rate. Lower interest rates make it harder for banks to make money from loans. ETrade Financial slumped $1.68, or 6 percent, to $26.45, while Charles Schwab lost $1.72, or 5.9 percent, to $29.12. Citigroup fell $2.37, or 5.1 percent, to $44.60.

GOLD RUSH: Mining companies were among the biggest gainers as the price of gold, silver and copper surged. Newmont Mining gained $2.51, or 7.8 percent, to $34.83, while Freeport-McMoRan added 47 cents, or 4.5 percent, to $11.13.

BONDS AND CURRENCIES: U.S. government bond prices rose. The yield on the 10-year Treasury note fell to 1.71 percent from 1.80 late Thursday, a large move. In currency markets, the dollar was among the biggest movers, falling to 106.96 yen from 108.91 the day before. The euro jumped to $1.1335 from $1.1148.

ENERGY: Benchmark U.S. crude oil was down 36 cents to $48.81 a barrel in New York. Brent crude, which is used to price international oils, was down 41 cents at $49.62 a barrel in London.

MARKETS OVERSEAS: In Europe, major stock indexes mostly fell. Germany’s DAX fell 1.2 percent, while France’s CAC 40 lost 1.1 percent. Britain’s FTSE 100 slipped 0.1 percent. Earlier in Asia, Japan’s benchmark Nikkei 225 added 0.5 percent, while South Korea’s Kospi inched up 0.04 percent. Hong Kong’s Hang Seng added 0.4 percent. The S&P/ASX 200 of Australia jumped 0.8 percent.

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