Aug. 1 (Bloomberg) -- U.S. stock futures trimmed losses, following the biggest drop in the Dow Jones Industrial Average in five months, as data showed employers added more than 200,000 jobs for a sixth straight month in July, a sign of growing optimism about the economic outlook.
Standard & Poor’s 500 Index futures expiring in September fell 0.2 percent to 1,921.5 at 8:34 a.m. in New York, after dropping as much as 0.7 percent earlier.
The 209,000 advance in payrolls followed a 298,000 gain in June that was stronger than previously reported, figures from the Labor Department showed today in Washington. The median forecast in a Bloomberg survey of economists called for a 230,000 increase. The jobless rate climbed to 6.2 percent from 6.1 percent in June as more people entered the labor force. Wages and hours were unchanged from June.
Data earlier this week showed U.S. gross domestic product expanded at a 4 percent annual pace in the second quarter, confirming the Federal Reserve’s view that a first-quarter contraction was transitory.
The Fed this week cut its monthly bond buying to $25 billion in its sixth consecutive $10 billion reduction. The Fed’s Open Market Committee reiterated that it’s likely to reduce bond buying in “further measured steps” and to keep interest rates low for a “considerable time” after ending purchases. The central bank said slack in the labor market persists even though the economy is picking up.
U.S. stocks joined a global selloff yesterday, erasing the year’s gains in the Dow, as Exxon Mobil Corp. to Micron Technology Inc. tumbled amid weaker corporate results.
Equities have been weighed down this week by global turmoil as Argentina missed a deadline to pay $539 million in interest after failing to produce an agreement with creditors from its last default in 2001, and amid rising tensions in the Gaza Strip. In addition, Portugal’s Banco Espirito Santo said it needs to raise capital after a first-half loss, and companies from Adidas AG to Lufthansa AG said unrest in Russia and Ukraine dimmed prospects for growth.
The S&P 500, which is up 4.5 percent this year, has gone without a 10 percent correction since 2011. The benchmark index is down 2.9 percent from a record of 1,987.98 reached on July 24. It trades at 17.6 times the reported earnings of its companies, near the highest level since 2010.
Market volatility is rising after the S&P 500 ended its longest stretch of calm since 1995. The index has posted gains or losses of more than 1 percent three times in the past two weeks, compared with none during the 62 days through July 16, data compiled by Bloomberg show.
Chevron Corp. and Procter & Gamble are among six S&P 500 members to report earnings today. Some 76 percent of the 373 companies that have released results this season have beaten analysts’ estimates for profit, while 65 percent have exceeded sales projections.