U.S. stocks turned negative late-morning Friday, after trading modestly higher at the start of trade, as new jitters on trade relations overshadowed a November employment report. For the week, the Dow, S&P 500 and Nasdaq are set to show declines of more than 3%.
The U.S. economy added 155,000 new jobs in November, the Labor Department estimated Friday morning, below expectations of 190,000 new jobs. The jobs report also showed the unemployment rate holding steady at 3.7%, as expected. Average hourly earnings grew at 6 cents per hour from October, or 0.2%, just shy of expectations, and grew by 3.1% year-over-year, their highest rate since 2009.
The jobs numbers are of particular importance to investors, as these data will inform The Federal Reserve’s interest-rate-setting committee, the FOMC, as it prepares to decide whether to raise interest rates at its coming meeting Dec. 18-19.
Signs that the FOMC may take a less aggressive tack in normalizing rates have increased, with The Wall Street Journal on Thursday reporting that Fed officials are considering a new wait-and-see mentality at that December meeting.
Expectations for a December interest-rate increase are showing a 76.6% probability, down from 83% a week ago, according to CME Group data, with expectations increasing that policy makers may cool the rate-hike path in 2019.
The jobs data come after a frenetic session that had been colored by fears of intensifying trade battles between the U.S. and China. That was after the arrest in Canada of a top Chinese tech executive at China telecommunications giant Huawei Technologies, which amplified worries in a market already skittish about relations between Beijing and Washington on tariffs and intellectual-property rights.