US stocks ended lower for the second day in a row on Friday, after a report showing job growth in June was less than half of what Wall Street expected prompted investors, wary of an economic slowdown, to sell shares of cyclical stocks like Caterpillar Inc.
On Nasdaq, Apple Computer Inc and chip maker Intel Corp pulled down the technology-heavy index. Apple shares were off nearly 4 percent after the company said it would delay the introduction of its next iMac computer.
Intel also fell more than 2 percent after Deutsche Bank downgraded the company to "hold" from "buy," citing supply chain uncertainties.
The sell-off, which sent the Dow down to its lowest level in nearly a month during the session, was sparked by data that showed the pace of US job growth fell off sharply in June after several months of robust gains. The Labour Department report said only 112,000 jobs were created, far fewer than the 250,000 that Wall Street analysts expected.
"The payroll report was weaker than people anticipated," said Edward Riley, chief investment strategist at State Street Global Advisors. "People are now saying we should start looking at the earnings to see how much of a slowdown is taking place."
The Dow Jones industrial average ended down 51.33 points, or 0.50 percent, at 10,282.83, while the Standard & Poor's 500 Index was down 3.56 points, or 0.32 percent, at 1,125.38. The tech-heavy Nasdaq Composite Index was down 8.89 points, or 0.44 percent, at 2,006.66.
For the week, stocks fell. The blue-chip Dow average and the tech-driven Nasdaq each slipped 0.9 percent, while the broader S&P 500 was off 0.8 percent.
Trading was light, with 1.09 billion shares changing hands on the New York Stock Exchange, below the 1.4 billion daily average for last year. About 1.2 billion shares were traded on Nasdaq, below the 1.8 billion daily average last year.
US financial markets will be closed on Monday in observance of the Independence Day holiday.
Investors are often reluctant to buy stocks ahead of a long weekend, wary of events that might roil stocks when the market opens again on Tuesday.
Shares of companies especially vulnerable to swings in the economy fell amid concern that profits might be in jeopardy if growth slows.
Heavy equipment maker Caterpillar ended off $1.46 at $76.72, while shares of aluminum company Alcoa Inc closed down 12 cents at $32.18. Diversified manufacturer 3M Co shares slipped to end down 67 cents at $87.50.
But the job numbers boosted housing stocks as investors bet that the US Federal Reserve would be slow to increase interest rates following the weak employment figures.
Home builder and mortgage company Centex Corp closed 76 cents higher at $46.01 and Los Angeles-based home builder KB Home advanced $1.32 to end at $69.12. Michigan-based home builder Pulte Homes Inc gained $1.12 to $52.86.
"It's the combination that the Fed will be able at move at the measured pace that they spoke about and that this 25-basis-point move may carry a little bit longer than originally intended," said Argus Research analyst Kevin Tynan.
Apple shares closed down $1.22 at $31.08 and shares of Intel ended off 69 cents at $26.33.
Shares of WebMethods Inc, a business software maker, fell more than 32 percent after the company warned of a hefty fiscal first-quarter loss, which was well short of Wall Street expectations. The stock ended down $2.71 at $5.63.
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