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Employment report fails to spark markets

A key economic report provides a slight boost for stocks, which manage to end the week in positive territory.

3 min read
A key economic report provided a slight boost for stocks, which managed to end the week in positive territory.

The Labor Department reported that 108,000 jobs were lost in July. The private sector added 138,000 jobs, but this gain was more than offset by the 290,000 census workers who lost their temporary jobs.

As a result, the unemployment rate held steady at 4 percent, unchanged from June. Hourly earnings edged up 6 cents for the month, an increase of 3.7 percent from July 1999.

"The report was consistent with a moderating economy in every way," said Peter Kretzmer, an economist at Banc of America Securities.

Overall, the report showed little signs of a tightening labor market, an indication that the red-hot economy may be cooling. If additional data points to an economic slowdown, the Federal Reserve may be inclined to leave interest rates unchanged when it meets later this month.

The Nasdaq composite index rose 27.48 to 3,787.36, and the Standard & Poor's 500 index climbed 10.37 to 1,462.93.

The Dow Jones industrial average rose 61.17 to close at 10,767.75, led by J.P. Morgan, which gained $8.25 to $143.25.

"The report was market-favorable," said Al Goldman, chief market strategist at A.G. Edwards, who believes the news could have driven the markets much higher in different circumstances. "The markets had an opportunity for an up, up and away day, but it was only an up day.

"There's a low level of confidence; it's a Friday in August, and no one wants to be brave," Goldman added. "It's almost as if everybody is waiting for someone to make the first dive into the market."

For the week, the Nasdaq and S&P 500 finished 3 percent higher. The Dow gained 2 percent.

At the end Tune in to CNET News.com TV's IPO
Forecast of regular trading, Intel closed down $2.50 at $62.56, and Microsoft fell $1.13 to $69.13. Oracle rose $4.13 to $81.56, and Sun Microsystems fell $1.06 to $106.63.

The CNET tech index edged down 1.08 to close at 2,608.21. Losers and winners finished about even, with 46 of the 97 stocks in the index falling, 48 rising and three remaining unchanged.

Of the 18 sectors tracked, server software developers were the day's largest gainers, climbing 4 percent, followed by computer memory-storage companies, which climbed 3 percent. Semiconductor equipment and semiconductor makers posted the sharpest declines, falling about 1 percent each.

Some initial public offerings posted respectable gains. The IPO of Microtune, a provider of radio-frequency tuners for cable modems and digital TVs, posted the largest percentage gain on the Nasdaq. Microtune shares rose $14.13, or 88 percent, to $30.13.

Giganet's IPO posted double-digit gains. The maker of wireless equipment that enables communications companies to send data, video and voice signals over their networks rose $5.50, or 32 percent, to $22.50.

Among members of the CNET tech index, Exodus Communications rose $4.25, or 9 percent, to $51.13.

Semiconductor stocks had a rough day. The Philadelphia semiconductor index fell 29.57, or 3 percent, to 921.02, led by chipmaker Xilinx, which lost $5.75 to close at $73.13. Altera dropped $6.19 to $97.06, and Novellus slipped $2.88 to $45.38.