U.S. Stocks Plunge Amid Labor Market Weakness and Rate Hike Doubts

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By Brendel Balaga

U.S. stocks fell on Friday, after the odds of an imminent rate increase dwindled following the release of weak jobs data. Particularly affected were bank stocks, which shed between 2 to 4 percent.

The U.S. Department of Labor said nonfarm payrolls grew by a mere 38,000 in May, the smallest gain in more than 5 years, after missing growth forecasts of 164,000.

The odds of a rate hike happening this month is now down to a measly 2 percent, significantly lower than the 20 percent probability just before the payrolls data was released.

The S&P 500 financial index (SPSY) plummeted 1.8 percent, on its way for the index’ biggest single-day plunge in nearly two months.

The dollar index (DXY) slipped 1.4 percent, falling to a one- month low of 94.19, against a bunch of rival currencies.

As of 9:37 a.m. ET, the Dow Jones industrial average (DJI) have fallen 85.12 points, or 0.48 percent, at 17,753.44.

The S&P 500 (SPX) also tumbled, shedding 9.35 points, or 0.44 percent, at 2,095.91, while the Nasdaq Composite (IXIC) gave up 24.62 points, or 0.5 percent, at 4,946.75.

Citigroup (N:C), Goldman Sachs (N:GS), JPMorgan (N:JPM), Bank of America (BAC), and Wells Fargo (N:WFC) shed around 2-4 percent.

JPMorgan was the biggest loser on the S&P 500, while Goldman Sachs shed the most on the Dow.

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