Dow dives 275 points on dismal jobs report

Associated Press

Alarmed by an ominously weak U.S. jobs report, investors ran for safety Friday from new worries about a global slowdown, sending the Dow Jones industrial average into a 275-point dive, the index’s biggest loss since last November.

The broad sell-off wiped out the last of the index’s gains for the year.

Across Wall Street, fearful investors snapped up safer investments such as bonds, dragging the yield on the benchmark 10-year Treasury note to a record low. Gold spiked $50 an ounce, and oil fell to its lowest since October.

“The big worry now is that this economic slowdown is widening and accelerating,” said Sam Stovall, chief equity strategist at S&P Capital IQ, a market research firm.

The Standard & Poor’s 500 index and Nasdaq composite index both fell more than 2 percent. The Nasdaq has dropped more than 10 percent since its peak — what traders call a market correction. The S&P 500 is just a point above correction territory.

American employers added just 69,000 jobs in May, the fewest in a year, and the unemployment rate increased to 8.2 percent from 8.1 percent. Economists had forecast a gain of 158,000 jobs.

The report, considered the most-important economic indicator each month, also said that hiring in March and April was considerably weaker than originally thought.

Earlier data showed weak economic conditions in Europe and Asia, too. Unemployment in the 17 countries that use the euro currency stayed at a record-high 11 percent in April, and unemployment spiked to almost 25 percent in Spain.