US jobless figures hit stock markets

Published:  24 Aug at 9 AM

An announcement by the US government that the number of jobless was up over the last week has caused stocks to fall. According to the Labor Department, the number of unemployed has risen by 4,000. Experts are worried that this will mean job growth for August has slowed down compared to last month.

The Dow Jones dropped 74 points on the announcement to hit 13,099 and Standard and Poor’s 500 fell seven points to 1,407 having earlier in the week risen to a four year high. A number of Europe’s major indexes also fell as Greece struggles to meet the terms of bailout loans set by Germany.

Assumptions by analysts that the US Federal Reserve is on the brink of announcing further monetary stimulus measures has helped the price of gold to rally to $1,667 per ounce, an increase of 1.6 per cent or $27 per ounce.

Investors look to gold whenever the dollar looks like it is weakening. This will happen if significant amounts of cash are pumped into the US economy by the central bank.

The Nasdaq composite index ended at 3,048, a drop of 25 points. All 10 S&P major stock categories were down with the worst hit being materials companies and technology stock. Hewlett Packard shares ended at $17.99, a drop of 6.3 per cent or $1.21.