Friday, June 7, 2013

Weak Employment Data Sinks Stock Markets

In a rare move, every Dow Jones Industrial Average (DJINDICES: ^DJI  ) stock is losing value today, and the index itself has lost 1.4% of its value near the end of the trading session. The broader S&P 500 (SNPINDEX: ^GSPC  ) is off 1.36% today as investors weigh the Federal Reserve's next move and weakening economic data.

ADP released its private-sector employment survey results, which showed a 135,000 increase in the number of jobs in May. That fell below forecasts of 170,000 , casting a shadow on the Department of Labor's results due out on Friday. It was also worrisome that a reading of hourly compensation fell 3.8%, putting even more pressure on U.S. workers.

The Fed didn't help matters by saying the U.S. economy is growing at a "modest to moderate" pace. Investors are left to guess what the Fed's next move is, and with unemployment weak, inflation low, and manufacturing slowing, I'd bet that stimulus is the answer. 

After being one of the best performers on the Dow over the past few days, Intel (NASDAQ: INTC  ) is one of the biggest losers today, falling 2.4%. Analysts at JPMorgan warned that lower PC sales could hurt results in the second quarter, causing the company to miss expectations. 

That could well be true, but long-term investors should be focusing on the company's Galaxy Tab 3 win and the upcoming Broadwell chip as great signs for the company. Intel is finally gaining traction in the mobile market, and that should help the company grow over the next few years.

When it comes to dominating markets, it doesn't get much better than Intel's position in the PC microprocessor arena. However, that market is maturing, and Intel must find new avenues for growth. In this premium research report on Intel, a Motley Fool analyst runs through all of the key topics investors should understand about the chip giant. Click here now to learn more.

Intel's usual partner, Microsoft (NASDAQ: MSFT  ) , is down 0.9% today after unveiling an update to its main operating system. The update, dubbed Windows 8.1, incorporates user feedback, including the return of the "Start" Button. The update won't be available until later this year, and I wouldn't expect it to goose sales for the software giant. What will be more important is gaining share in mobile, where Microsoft is starting to gain some traction, though it still plays a distant third fiddle to Apple and Google. 

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