A bad jobs report has sent investors scrambling, and the Federal Reserve may put off its big interest rate move.
The U.S. stock market took a big dive on Friday to close out the week after a poor jobs report worried investors — and things may get worse before they get better.
Now, investors are wondering when the Federal Reserve will make its long-awaited move to raise interest rates, especially with the unemployment rate following to a seven-year low in August, according to an Associated Press report.
An increased rate of hiring could cause the Fed to be encouraged that the economy is strong and boost its rates sooner in order to keep a lid on inflation, but with a mixed jobs report coming out, investors are concerned that there is still some underlying weakness in the market — and China’s economic woes aren’t helping things either.
Investors will be keeping a close eye on the Chinese stock market on Monday with U.S. markets closed for Labor Day. If there’s another big swing lower as has been seen in China lately, it could further depress the U.S. market when it opens back up on Tuesday.
The Dow Jones Industrial Average dipped 303 points on Friday, a decline of 1.9 percent to 16,071. The Standard & Poor’s 500, meanwhile, dropped 1.7 percent, which amounted to 34 points, dipping down to 1,917. The NASDAQ dropped to 4,677, a 1.2 percent drop of 56 points.
The jobs report indicated that employers added just 173,000 jobs, although previous months had their gains revised upward. The unemployment rate declined to 5.1 percent, which was a positive development and marks the lowest level since March 2008.
The FTSE 100 index over in Europe dipped 2.4 percent, while Germany’s DAX dived 2.7 percent, and France’s CAC-40 dipped 2.8 percent.