NEW YORK (AP) – Stocks opened lower on Friday as another strong U.S. jobs report raised the likelihood that the Federal Reserve would start to raise interest rates later this year. The dollar jumped and U.S. government bond prices fell after the report.
KEEPING SCORE: The Standard & Poor’s 500 index fell seven points, or 0.4 percent, to 2,093 as of 10:03 a.m. Eastern. The Dow Jones industrial average dropped 81 points, or 0.5 percent, to 18,054. The Nasdaq composite fell six points, or 0.1 percent, to 4,976.
MORE JOBS: U.S. employers extended a healthy streak of hiring in February by adding 295,000 jobs, the 12th straight monthly gain above 200,000. The Labor Department said Friday that the unemployment rate fell to 5.5 percent from 5.7 percent. Still, the strong job gains weren’t enough to boost wages by much. The average hourly wage rose just 3 cents in February to $24.78 an hour.
ANALYST TAKE: The strong hiring report will likely fuel speculation that the Federal Reserve will raise interest rates as early as June. Last week Fed Chair Janet Yellen indicated that a summer hike was possible, while leaving the door open to a later increase. “All things considered I think this is a very good labor market report and will only feed into expectations for a rate hike from the Fed in June,” said Craig Erlam, senior market analyst at OANDA. “The rally in the dollar immediately after the release clearly supports this view.”
THE BIGGEST LOSERS: The yield on the 10-year Treasury note jumped to 2.20 percent from 2.12 percent late Thursday, as investors factored in a higher probability of a summer rate hike.