Stocks Stuck in the Red on Jobs

(TheStreet) -- Stocks were mired in negative territory Friday as seven consecutive months of private sector job growth have done little to offset unexpectedly high job losses in July and a steep downward revision to June's levels. The Dow Jones Industrial Average was down 143 points, or 1.3%, to 10,532. The S&P 500 was shedding 17 points, or 1.5%, to 1109, and the Nasdaq was off by 30 points, or 1.3%, at 2263. Speaking about the economy this afternoon, President Obama called the recent recession "the most serious downturn since the Great Depression" but focused on promising signs in the private sector, which has now seen job growth every month of 2010. Goldman Sachs GS lowered its growth forecast for the U.S., saying that it now sees annual average growth of 1.9% in 2011, compared with its previous forecast for growth of 2.4%. It now expects GDP to accelerate from 1.5% in 2011's first quarter to 3% in the year's fourth quarter, which is down from its previous view for growth from 2.5% in 2011's first-quarter, to 3.5% in the second-half of the year. Goldman Sachs also said it expects the unemployment rate to rise to 10% and remain there in 2011. Reviewing the morning's employment data for July, Keith B. Hembre, chief economist and chief investment strategist at First American Funds of Minneapolis said, "It was not a good report in terms of what's necessary to get the unemployment rate on a sustained downward path and to be viewed as a sustaining force behind the recovery and eventual expansion." "That said, it wasn't all bad," he added. "Hours worked and average hourly earnings both grew, so if you think of the overall implications for household income generation, it should be sufficient to push consumer spending forward on an upward path." "The takeaway, however, is that it's difficult to identify the catalyst that would make August meaningfully better and that's a disappointment," Hembre said. Overseas, Hong Kong's Hang Seng climbed 0.6% while Japan's Nikkei slipped 0.1%. The FTSE in London was shed 0.6%, and the DAX in Frankfurt dropped 1.2%. To read the rest, head over to TheStreet.com