Wall Street slips after data, holds near record

By Rodrigo Campos

NEW YORK (Reuters) - U.S. stocks slipped on Friday after data showed U.S. hiring slowed in July but the jobless rate fell, mixed signals that could make the U.S. Federal Reserve more cautious about drawing down its economic stimulus.

Consumer spending, however, increased in June and inflation pushed higher, while new orders for U.S. factory goods rose for the third straight month in June, data that could strengthen expectations that the Fed will wind down its bond purchases later this year.

The key jobs report showed non-farm payrolls rose by 162,000 in July, below expectations, but the unemployment rate fell to 7.4 percent, its lowest reading since December 2008.

"Nothing in the jobs report says the economy is standing on its own. It was a confusing jobs report and it pushes tapering a little bit deeper into the fourth quarter," said Ron Florance, deputy chief investment officer at Wells Fargo Private Bank in Scottsdale, Arizona, in reference to expectations of the Fed's stimulus wind-down.

"Yesterday's rally was so strong, a little bit of retracement is not unexpected."

The S&P 500 posted Thursday its strongest day in three weeks to close above the 1,700 level for the first time.

The Fed's support has been a pillar of the recovery from the deepest recession since the Great Depression, and the U.S. central bank has reiterated that it will continue to stimulate the economy until it is capable of standing on its own.

Traders of short-term U.S. interest-rate futures boosted bets that the Fed will wait until 2015 before raising short-term borrowing costs after the payrolls report.

The Dow Jones industrial average <.dji> fell 56.13 points or 0.36 percent, to 15,571.89, the S&P 500 <.spx> lost 4.72 points or 0.28 percent, to 1,702.15 and the Nasdaq Composite <.ixic> dropped 7.14 points or 0.19 percent, to 3,668.61.

Dell's special committee and a group led by founder and chief executive Michael Dell announced a deal that dramatically increases the chances of his $24.6 billion buyout going through. Dell shares gained 4.8 percent to $13.58.

LinkedIn shares jumped 9.8 percent to $233.88 and several brokerages raised their price targets on the stock after results on Thursday topped expectations.

AIG Inc also beat expectations on Thursday and announced its first capital return since its 2008 bailout through a dividend and share buyback, sending its shares up 3.4 percent to $48.67.

Shares of MercadoLibre rose 10.1 percent to $133.68 a day after the Latin American e-commerce company reported quarterly results above analysts' expectations.

Of the 375 companies in the S&P 500 that reported earnings for the second quarter through Thursday morning, 67.5 percent have topped analyst expectations, in line with the average beat over the past four quarters, data from Thomson Reuters show. About 55 percent have reported revenue above estimates, more than the average beat of the past four quarters but below the historical average.

(Reporting by Rodrigo Campos; Editing by Nick Zieminski)

Source: http://news.yahoo.com/stock-futures-tick-ahead-u-payrolls-data-111836405.html

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