US jobs data hurts world equities markets

European equities markets were lower again Friday on bad news from the US Labor Department.

Although the Labor Department reported in its official figures that the US economy did lose as many jobs in December as a private reported had indicated earlier in the week, it was reported that the US unemployment rate rose to 7.2 percent in the month, the highest in 16 years.

The FTSE 100 was down 1.26 percent to 4,448.54 in London, while the FTSE 250 dropped 0.57 percent to 6,653.88.

Despite losses, most banks were higher, with the Royal Bank of Scotland (LSE: RBS; NYSE: RBS PRM) up 4.94 precent and HBOS (LSE: HBOS) adding 7.84 percent to lead the 100.

Miners were lower, with Anglo American (LSE: AAL) falling 8.19 percent for the biggest decline in the sector.

The FTSE Eurofirst 300 was down 0.34 percent to 867.95 while the CAC-40 fell 0.75 percent to 3,299.5, the IBEX was 0.96 percent lower to 9,378.5 and the Dax dropped 1.97 percent to 4,783.89.

Unlike the banks in London, most banks in Paris and Frankfurt saw declines, with Commerzbank (FWB: CBK) seeing the biggest drop on the Dax for the second day in a row as it fell 11.05 percent.

The automobile manufacturing sector, however, saw gains as Peugeot (Euronext: UG) added 2.79 percent on the CAC-40 and BMW (FWB: BMW) gained 3.18 percent in Frankfurt.

Most Asia-Pacific region markets were also lower in continuing worries about the state of the global economy.

In Tokyo, the Nikkei 225 was down 0.45 percent to 8,836.8 while the Topix index fell 0.68 percent to 855.02 but the Mothers market of small and mid-caps added 0.16 percent to 335.34.

In light trade ahead of a three-day weekend, industrial robot maker Fanuc (TYO: 6954) dropped 7 percent on a broker downgrade but Fast Retailing (TYO: 9983) added 3.5 percent after it reported that profits were up in its fiscal first quarter.

Elsewhere in the region, the Hang Seng was down 14,377.44 while the Taiex fell 0.73 percent to 4,502.74, the Straits Times Index was 1.18 percent lower to 1,806.02, the Sensex dropped 1.88 percent to 9,406.476 and the Kospi fell 2.05 percent to 1,180.96.

Australian markets saw gains, with the Sydney Ordinaries gaining 1.01 percent to 3,680.4 and the S&P/ASX200 added 1.12 percent to 3,735.7, while the Shanghai Composite was up 1.42 percent to 1,904.86 in China.

Wall Street was down after the Labor Department issued its jobless data, with the Dow Jones Industrial Average falling 1.38 percent to 8,621.88 while the Nasdaq Composite was down 2.34 percent to 1,579.11 and the S&P 500 dropped 1.87 percent to 892.74.

Besides the news that the number of jobs in the US dropped and the unemployment rate rose in December, the average work week fell to just 33.3 hours, the fewest hours worked on average since 1964, when record began to be kept.

The Labor Department also reported that a total of 2.6 million jobs were lost in 2008, the most since 1945.

Lennar (NYSE: LEN) dropped 13.92 percent after a letter appeared on the internet accusing the homebuilder of wrongdoing in association with a project it was involved in to build luxury homes in California in the 1980s.

In a statement, Lennar accused the author of the letter, Barry Minkow, of making “false and inflammatory accusations.”

The oil sector saw declines after Chevron (NYSE: CVX) issued a profits warning.

Chavron was down 1.12 percent in afternoon trade while at the same time ExxonMobil (NYSE: XOM) had dropped 1.24 percent.

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