Market wrap: Stocks are set to open in the red for the first time this week after a late slide on Wall Street.
U.S. share indexes edged in and out of positive territory for much of the session before a final-hour sell-off on low volume ahead of tonight's crucial jobs figures. The Dow closed 87 points or 0.83% lower, the S&P 500 lost 0.84% and the Nasdaq 0.54%.
Wall Street initially took heart from better-than-expected jobless claims and news that Bank of America has sufficient confidence in the recovery to repay last year's government bailout money. The government said jobless claims last week were 457,000, about 5% less than economists predicted.
But weak service-sector data sent a chill through the market. The Institute for Supply Management said its non-manufacturing index fell to 48.7 last month, worse than the 51.7 expected by economists and flagging a slide from expansion to contraction in U.S. manufacturing. The report heightened worries about tonight's employment numbers. Also weighing on sentiment were mixed reports from retailers on consumer spending during the Christmas holiday season.
Tech stocks fared better than most in a falling market. Also ahead were airlines +0.68% and utilities +0.42%. Miners, oilers, financials and REITs all lost ground.
The major European markets began the session at weekly highs but couldn't hold their gains. Britain’s FTSE slipped 0.27%, Germany’s DAX lost 0.2% and France’s CAC finished 0.08% higher.
Gold futures set another new high as investors continued to hedge against a sliding U.S. dollar, but have since pulled back. The spot gold price broke $1,226 an ounce and was recently trading at $1,210.90, down $4 from yesterday's close.
Oil futures were held back by the decline in the service-sector index and buying interest ebbed and flowed with the U.S. dollar. Crude futures were recently trading at $76 a barrel, a loss of 0.5%.
Base metals continued to push higher on a post-Dubai debt relief rally. There were new multi-month highs for copper, aluminium, zinc and lead in London. Copper added 0.57%, aluminium 2%, lead 0.08%, zinc 2.02%, nickel 0.49% and tin 0.63%.
"All of a sudden we have seen the Dubai concerns come and go and that same money that got quickly thrown into the dollar is coming right out of it and coming right back into commodities," said a senior metals analyst quoted on Reuters.
Futures traders expect our market to pull back at today's open. The SPI futures index closed 34 points lower at 4754.
TRADING THEMES TODAY
PULLBACK: A perfect week of five advances looks beyond our market today after that nasty final-hour tumble in the US. But there's no need for panic - last night's US unemployment claims offer hope that tonight's jobs figures will meet expectations, and Wall Street could bounce back as swiftly as it fell. Cautious day ahead for me. Fridays tend to be weak anyway, and profit-taking should see our market give back some of this week's heady gains.
ECONOMIC NEWS: No significant local news scheduled today but the US trading week ends tonight with the all-important official unemployment rate for November, plus non-farm payrolls, October factory orders and average hourly earnings.
