The U.S. government had reported that unemployment climbed to a six-year high of 5.7 percent in November. That was up from 5.4 percent in October. What’s more, a staggering 331,000 non-farm jobs were eliminated, a drop much greater than the 189,000 cuts expected by economists.
Upon the news, the Dow Jones industrial average dropped 45.32 points, or 0.45 percent, to 10,053.82, while the Standard & Poor's index fell 6.31 points, or 0.54 percent, to 1,160.79. The technology-based Nasdaq went down 18.06 points, or 0.88 percent, to 2,036.21.
The unemployment figures also increased expectations that the Federal Reserve would cut short-term interest rates at its meeting next week in hopes once again of boosting the economy.
According to Reuters, Wall Street effectively “shrugged off” news that a key gauge of consumer confidence had bounced up in early December. The University of Michigan's preliminary consumer sentiment index for December had risen for a third straight month, reaching 85.8 from 83.9 in November. But that bit of positive news wasn’t nearly enough to offset the grim unemployment stats.
U.S. progress in the war against Afghanistan’s Taliban rulers, Reuters noted, has helped buck up Wall Street in recent weeks. That trend continued today as reports came in that hard-liners were surrendering Kandahar, the birthplace and last stronghold of the Taliban. Nevertheless, supreme Taliban boss Mullah Mohammad Omar and terrorist overlord Osama bin Laden remain at large.