US stocks fade as investors worry about unemployment

NEW YORK (AP) — The stock market extended its slide as investors worried that a weak job market will trip up a recovery in the economy.

According to preliminary calculations, the Dow fell 29.93, or 0.3 percent, to 9,280.67. The S&P 500 index fell 3.29, or 0.3 percent, to 994.75, while the Nasdaq composite index fell 1.82, or 0.1 percent, to 1,967.07.

Stocks posted modest losses Wednesday, a day after tumbling on fears about banks and concerns that a six-month rally of more than 50 percent has left the stock market overheated. The Dow Jones industrial average lost another 30 points after skidding 186 points Tuesday.

Mixed economic reports kept traders from pushing into the market in search of bargains.

A private sector report on unemployment gave investors new reason to fret about what is widely seen as the biggest problem facing the economy. The ADP National Employment Report found that employment fell by 298,000 in August following a revised loss of 360,000 jobs in July. The losses were the smallest since September 2008 but more than analysts had expected.

The report shapes expectations for the Labor Department’s monthly reading on jobs, which is due Friday. Unemployment has hit consumer spending, which accounts for about 70 percent of US economic activity. Without more help from consumers, the economy will have trouble pulling out of the longest recession since World War II.

“Until Friday’s data comes, no one is really making any big bets,” said Neil Massa, senior trader at MFC Global Investment Management. “A little profit-taking looks healthy at this point.”

Analysts said the market’s ability to avoid another steep drop was a good sign but cautioned that trading volume remains light ahead of the Labor Day holiday. Light volume can skew the market’s moves and makes it difficult to draw conclusions about investor sentiment.