Russell 2000 drops
The Russell 2000 (NYSE: IWM) and the other major U.S. indices are falling following news of a weak December jobs report.
At 10:31 a.m. ET, the small-cap index had retreated 15.51 points, or 2.08%, to 729.50. The Dow Jones Industrial Average (INDU) was off 165.58 points, or 1.27%, to 12,891.14.
Stocks are sinking on news before the start of trading that nonfarm payroll employment increased a paltry 18,000 in December, according to the U.S. Labor Department. Economists were expecting to see 70,000 new jobs following an upwardly revised level of 115,000 in November.
The unemployment rate jumped to 5% from 4.7% as job losses in construction and manufacturing offset gains in several service-providing industries. That translates to a total of 7.7 million unemployed people, an increase of 474,000 from the level in November.
Overall, the December job creation was the weakest since August 2003 and an obvious sign that U.S. economic growth is faltering amid tighter credit and the ongoing slump in the housing market.
Elsewhere in the same report, average hourly earnings of production and nonsupervisory workers on private nonfarm payrolls rose by 0.4% to a seasonally adjusted $17.71. That’s the same gain as in November.
In more economic news, the Institute for Supply Management announced after the opening that its index of non- manufacturing businesses fell to 53.9 in December from a level of 54.1 in November.
That’s a smaller-than-expected drop but still represents the slowest rate of expansion in nine months. Readings above 50 show an expansion.
With non-manufacturing businesses making up almost 90% of U.S. gross domestic product, the numbers are another warning that the economy is slowing.
Here are the current biggest percentage gainers and losers among companies with a market cap between $100 million and $750 million:
Biggest percentage gainers:
• North Pointe Holdings Corp. (NPTE), up 46% on news it is being acquired by QBE Insurance Group Ltd. (QBE) for $146 million.
• Origin Agritech Ltd. (SEED), up 18%.
• Spark Networks, Inc. (LOV), up 13% on news it is seeing a buyer.
Biggest percentage losers:
• Micrel, Inc. (MCRL), down 22% on news it has revised its earnings and revenue outlook for the fourth quarter of fiscal 2007.
• Arctic Cat Inc. (ACAT) down 22% on news it has lowered its outlook for the fourth quarter and the fiscal year.
• Zumiez Inc. (ZUMZ), down 14%.
