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5/7/2004
04:47 PM
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Jobs Report Sends Markets Reeling

A Labor Department report saying the economy created 288,000 jobs last month sent stocks tumbling on fears of an interest-rate hike.

Investors went on a selling spree Friday as Wall Street balked at a report of strong job growth in April and began bracing for an interest-rate hike. But technology outperformed most other sectors, with big names such as Cisco Systems, Dell, and Intel posting gains,

The InformationWeek 100 fell 2.54 points, or 0.8%, to 307.54, but finished the week ahead 0.6% The Dow Jones industrials fell 123.92 points, or 1.2%, to close at 10,117.34, while the Nasdaq Composite fell 19.78 points, or 1%, to 1,917.96. The S&P 500 fell 15.30 points, or 1.4%, to 1,098.69. For the week, the Dow lost 108.23 points, or 1.1%, the S&P 500 fell 8.61 points, or 0.8%, and the Nasdaq fell 2.19 points, or 0.1%. It was the second straight week of declines for all three major indexes, which hit their lowest levels since March 24.

The Nasdaq-100 tracking stock fell 29 cents to $34.97 as more than 137 million shares changed hands.

A blowout jobs report--the Labor Department estimated that the economy created 288,000 new jobs last month and unemployment fell to 5.6%--seems to have persuaded traders that the Federal Reserve will raise rates for the first time in four years at its June meeting. On Tuesday, the Federal Open Market Committee said, with risks to the economy now balanced, rates can rise at a "measured" pace.

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