U.S. stocks fell sharply on Friday after a stronger-than-expected jobs report sent interest rates higher.
The Dow Jones industrial average dropped 354 points, with Exxon Mobil sliding 5.7 percent. The S&P 500 fell 1 percent, with energy as the worst-performing sector. The Nasdaq composite declined 1.1 percent as a decline in Apple and Alphabet offset a strong gain in Amazon shares.
The U.S. economy added 200,000 jobs in January, according to the Bureau of Labor Statistics. Economists polled by Reuters expected growth of 180,000. Wages, meanwhile, rose 0.3 percent last month, in line with expectations.
The report sent interest rates higher. The benchmark 10-year yield rose to 2.84 percent on the back of the report, hitting a four-year high. Investors have been jittery about the recent rise in interest rates, worrying they may be rising too fast.
On Thursday, the 30-year yield rose to 3.074 percent, its highest level since March.
“The reaction in the bond market is due to the rise in average hourly earnings,” said James Ragan, director of individual investor group research at D.A. Davidson. “I think the market is now thinking of the possibility that the Fed could raise rates four times this year rather than three.”
The Federal Reserve has forecast three rate hikes for 2018.
This has been a volatile week for U.S. stocks. The Dow, S&P 500 and Nasdaq were on pace to snap four-week winning streaks.
Wall Street also looked to the release of key corporate earnings. Exxon Mobil reported weaker-than-expected earnings on Friday, sending its stock lower.
Tech giants Apple and Amazon reported quarterly results Thursday after the close. Apple shares, however, traded 2.7 percent lower. Amazon popped 5.1 percent to an all-time high. Shares of Google-parent Alphabet, meanwhile, fell 4.9 percent after its earnings missed expectations.
About halfway through the earnings season, most companies have posted upside surprises. of the S&P 500 companies that have reported as of Friday morning, 75 percent have beaten bottom-line expectations, while 79 percent have surpassed sales estimates, according to FactSet.
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