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U.S. stocks fell Friday after the government reported a big loss in jobs last month because of the coronavirus pandemic.
The Dow Jones industrial average fell 60 points. The Standard & Poor’s 500 dipped 0.2%, as gains in energy shares offset broad losses elsewhere. Heading into Friday, the Dow was down 1% for the week while the S&P 500 had shed 0.6%.
The U.S. lost 701,000 jobs in March, the Labor Department said Friday, the first decline in job creation in a decade. The unemployment rate last month rose to 4.4% from 3.5%.
The data comes after a separate report on Thursday showed a record 6.6 million Americans applied for unemployment benefits last week. That was double the previous week’s job losses of 3.3 million. It raised the total number of Americans who are out of work due to the coronavirus-driven downturn to almost 10 million.
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To be sure, experts say the March unemployment report won’t capture the full picture of how the pandemic has affected the economy since it’s based on a survey taken earlier in the month. The first post-shutdown jobs report for April will be released on May 8.
“Job losses spiked in March, led by almost half a million fewer jobs in restaurants and hospitality, clearly one of the hardest-hit sectors in the economy thus far,” Mike Fratantoni, senior vice president and chief economist at the Mortgage Bankers Association, said in a note. “As bad as this month’s employment numbers were, given the rapid jumps in claims, we fully expect that next month will show even larger job losses.”
Many respondents in the household survey indicated that they are on temporary furlough, Fratantoni said, which could provide a quicker path for an economic recovery since economists expect most that are unemployed to be called back to work once the crisis abates.
“These jobs will come back. They didn’t disappear because of some defect in the economy,” Burt White, chief investment officer at LPL Financial, said in a note. “Lots of us are looking forward to going back to our favorite restaurant or taking a trip as soon as the all-clear is sounded, and we’re all hoping sooner rather than later.”
Traders expect more volatility in financial markets until numbers of new coronavirus cases begin to decline, which forecasters say might be weeks away.
The U.S. surpassed 6,000 deaths from the coronavirus pandemic Friday. There were more than 245,500 confirmed cases in the U.S., according to the Johns Hopkins University data dashboard. Worldwide, the death toll topped 53,000 and the virus had infected more than 1.6 million people.
On Thursday, the S&P 500 gained 2.3% after Trump said he expects production cuts are coming after talking with Saudi Crown Prince Mohammed bin Salman. Trump said on Twitter he expected major oil producers Saudi Arabia and Russia to back away from their price-cutting war.
U.S. crude prices were up 12% after surging almost 25% Thursday following Trump’s comments. The abrupt plunge in crude to below $20 this week from $60 at the start of the year triggered fears heavily indebted producers might default, undermining credit markets.
In Europe, the FTSE 100 in London sank 1.1% and Frankfurt’s DAX shed 0.3%. The CAC 40 in Paris lost 0.9%. In Asia, the Shanghai Composite Index lost 0.6% and Tokyo’s Nikkei 225 was flat. The Hang Seng in Hong Kong lost 0.2%.
Contributing: The Associated Press
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