By Lewis Krauskopf
(Reuters) – Wall Street pulled back from record levels on Friday after a four-day rally as investors digested a report showing U.S. job growth accelerated last month and braced for the next developments involving the coronavirus spread out of China.
Stocks were still poised for strong weekly gains with the S&P 500 on pace for its biggest weekly percentage rise in eight months and the Nasdaq set for its biggest weekly increase in over a year.
“It’s just a technical pullback based on the big run-up we had this week,” said Matt Maley, chief market strategist at Miller Tabak.
“Ever since the coronavirus became a big deal, people have pulled back a little bit on Friday because they didn’t know what was going to happen over the weekend,” Maley said.
The death toll in mainland China was above 630 as the coronavirus epidemic roiled the world’s second-largest economy.
The Labor Department’s closely watched employment report showed non-farm payrolls increased by 225,000 jobs last month, while economists polled by Reuters had forecast payrolls would rise by 160,000 jobs.
The report followed other encouraging U.S. economic reports earlier in the week, but Maley said the data may not be as important because they may not incorporate any impact from the coronavirus.
“We just don’t know the long-term effects of the coronavirus,” Maley said.
The Dow Jones Industrial Average () fell 305.79 points, or 1.04%, to 29,073.98, the S&P 500 () lost 22.09 points, or 0.66%, to 3,323.69 and the Nasdaq Composite () dropped 66.55 points, or 0.7%, to 9,505.60.
Most S&P 500 sectors fell, with materials () and technology () the weakest performers.
Key risks to the U.S. economy have receded, the Federal Reserve said in its late monetary policy report to Congress, but the Fed did note risk from the fallout from the coronavirus outbreak.
Fourth-quarter corporate reporting season is more than halfway done and overall S&P 500 earnings are expected to have climbed 2.3% in the period, according to IBES data from Refinitiv.
In company news, Uber Technologies Inc (N:) shares climbed 8.5% after the ride-hailing company laid out an ambitious plan to be profitable by the end of 2020.
Take-Two Interactive Software Inc (O:) shares fell 11.1% after the videogame publisher’s adjusted revenue missed estimates.
Declining issues outnumbered advancing ones on the NYSE by a 2.03-to-1 ratio; on Nasdaq, a 2.46-to-1 ratio favored decliners.
The S&P 500 posted 34 new 52-week highs and 1 new lows; the Nasdaq Composite recorded 71 new highs and 74 new lows.
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