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Wall Street Opens Lower After Jobs Disappointment; Dow Down 120 Pts By 

© Reuters.

By Geoffrey Smith — U.S. stock markets opened slightly lower on Friday in response to a hugely disappointing labor market report for August, which showed job creation at its slowest rate in six months. 

The Labor Department said nonfarm payrolls expanded by only 235,000 through the middle of the month, missing consensus forecasts by over half a million. The upward revision of July’s data to show an extra 100,000 jobs gained was scant consolation.

By 9:40 AM ET (1340 GMT), the was down 123 points, or 0.3%, at 35,323 points. The was up 0.2% and the was down 0.1%. The latter two indices are still on course for yet another weekly gain, however.

The market appeared unsettled by hints of stagflation in the report, as the spread of Covid-19 puts the brakes on growth while wages continued to grow above expectations. Average hourly earnings growth accelerated to 0.6% from 0.4% in July. Analysts had expected earnings growth to moderate to 0.3%. However, that development appeared due more than anything to the lack of low-paying service jobs created in the leisure and hospitality sectors, which brought average earnings up.

While the Covid-19 infection curve has started to flatten in recent days, the average number of deaths hit its highest since March over the last seven days.

Among individual movers, Apple (NASDAQ:) stock drifted down 0.1% after saying it would delay the rollout of new features in its iOS operating system to help root out child sexual abuse material. The new tools had been criticised by privacy groups and others. 

Didi Global (NYSE:) ADRs rose over 8% after Bloomberg reported that the city of Beijing is considering taking the company under state control, in ways that may or may not affect the ride-hailing share count but will very probably affect its governance. The move reflected expectations that the government would at least partially compensate sharerholders who have lost money since the company’s IPO in July. The stock is still down over 30% from its IPO price.

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