Stocks Lower on Jobs Report, Fed

Stocks Lower on Jobs Report, Fed

NEW YORK (AP) -- U.S. and global stocks were weighed down Monday as investors continued to reposition themselves following last week's jobs report and the increasing likelihood that the Federal Reserve could raise interest rates next month.

KEEPING SCORE: The Dow Jones industrial average lost 222 points, or 1.2 percent, to 17,689 as of 12:15 p.m. Eastern. The Standard & Poor's 500 index declined 30 points, or 1.3 percent, to 2,071 and the Nasdaq composite fell 72 points, or 1.4 percent, to 5,075.

JOBS REPORT AFTERMATH: Markets have been subdued since Friday, when an unexpectedly strong October jobs report cemented expectations the U.S. Federal Reserve is likely to raise short-term interest rates, which have been close to zero since the 2008 financial crisis. The Labor Department said U.S. employers created 271,000 jobs last month, more than the even most bullish of forecasts. The unemployment rate also dropped to 5 percent, the lowest in seven years.

RISING RATES: The possibility of higher interest rates continued to push bond yields higher. The yield on the 10-year Treasury note rose to 2.34 percent. That's up from 2.33 percent Friday and significantly higher than the 2.23 percent yield on Thursday. Yields on other Treasuries, including the two-year and three-year notes, also rose.

"This all shows how Friday's employment report possibly changed the game," John Briggs, head of fixed income strategy at RBS, wrote in a note to investors.

Securities that bet on which way the Fed will move interest rates show roughly a 70 percent chance the central bank will raise rates.

RAINY VACATION: Travel site Priceline fell $136.93, or 9 percent, to $1,311.72 after the company's outlook for the fourth quarter, a typically strong period for travel companies, came in short of analysts' expectations.

GLOBAL ECONOMY: Global stocks were also reacting to news out of China, where customs data showed the country's imports fell 18.8 percent in October from a year earlier, damping hopes for a Chinese economic rebound this quarter. Exports shrank 6.9 percent in a sign of weak global demand.

ENERGY: Benchmark U.S. crude fell 53 cents to $43.76 a barrel on the New York Mercantile Exchange. Brent crude, used to price international oils, slipped declined 26 cents to $47.16 a barrel in London.

CURRENCIES: The dollar fell to 123.08 yen from 123.21 yen Friday. The euro rose to $1.0764 from $1.0745.