NEW YORK, New York – A strong employment report Friday surprisingly upset Wall Street.
The Labor Department said nonfarm payrolls increased by 390,000 jobs In May, with the unemployment rate unmoved at 3.6 percent.
“It’s telling us the economy is in fairly good shape which is good news but when viewed in the context of what it means for the Federal Reserve and tightening monetary policy it likely makes them more confident they can continue to tighten,” Shawn Snyder, head of investment strategy at Citi Personal Wealth Management told Reuters Friday.
“That comes through as a bit of a negative for investors because they’re hoping for the Fed to pause later this year.”
The Nasdaq Composite bore the brunt of the selling onslaught. The key tech index tumbled 304.16 points or 2.47 percent to 304.16.
The Dow Jones industrials fell 348.58 points or 1.05 percent to 32,899.70.
The Standard and Poors 500 dropped 68.28 points or 1.63 percent to 4,108.54.
The U.S. dollar gained ground on the employment report with the euro slumping to 1.0720, by the New York close Friday. The British pound weakened to 1.2497. The Japanese yen was sharply lower at 130.87. The Swiss franc fell to 0.9625.
The Canadian dollar edged down to 1.2587. The Australian dollar dropped half a cent to 0.7209. The New Zealand dollar eased to 0.6510.
On overseas equity markets, the Dax in Germany retreated 0.17 percent. The Paris-based CAC 40 was down 0.23 percent. The FTSE 100 in London dropped 0.98 percent.
It was a more positive mood in Asia Friday. Japan’s Nikkei 225 rose 1.27 percent. The Australian All Ordinaries tacked on 0.97 percent. In China, the Shanghai Composite gained 0.47 percent. The S&P/NZX 50 in New Zealand added 0.60 percent. South Korea’s Kospi Composite climbed 0.44 percent. Going against the trend, the Hang Seng in Hong Kong weakened by 1.00 percent.