A wave of late selling pummeled U.S. stocks Friday and pushed the market to its worst week in more than four years.
The dismal start to the new year comes
as investors worry that China's huge economy is slowing down. That has helped send the price of oil plunging to its lowest level since 2004, the latest blow to U.S. energy companies.
Industrial and technology companies such as Boeing and Apple that do a lot of business in China also have fallen sharply this week. Mining companies such as Freeport-McMoRan plunged as copper prices have fallen. China is a major importer of copper.
Stocks started the day higher, driven in part by news of an encouraging burst in hiring last month by U.S. employers. China's stock market also rose 2 percent overnight, recovering somewhat after steep drops earlier in the week triggered trading halts.
Indexes wavered between small gains and losses for most of the day but took a decisive turn lower in the last hour of trading. That made this the worst week since September 2011, when the market was roiled by the fight over the U.S. debt ceiling and Standard & Poor's move to cut the credit rating of the U.S. government.
The Dow Jones industrial average dropped 167.65 points, or 1.02 percent, to 16,346.45. The Standard & Poor's 500 index fell 21.06 points, or 1.1 percent, to 1,922.03. The Nasdaq composite index shed 45.80 points, or 1 percent, to 4,643.63.
The Dow and S&P 500 are each down about 6 percent for the week. The Nasdaq composite fell even more, 7.3 percent. That index is heavily weighted with technology and biotech companies, both of which were high fliers last year.
Friday's largest losses went to financial stocks. JPMorgan Chase lost $1.35, or 2.2 percent, to $58.92, and Citigroup fell $1.43, or 3 percent, to $46.13. Health care stocks slumped, led by drug companies. Energy stocks also skidded as the price of oil, already at decade lows, continued to fall.
U.S. crude fell 11 cents to close at $33.16 a barrel in New York, and Brent crude, a benchmark for international oils, declined 20 cents to $33.55 a barrel in London.
In its monthly jobs report, released before the stock market opened, the Labor Department said U.S. employers added 292,000 jobs in December, far more than economists had forecast. On average, employers added 284,000 jobs per month in the fourth quarter, the best rate in a year.
Michael Fredericks, portfolio manager for BlackRock Multi-Asset Income Fund, said the labor market is healthy and wages could improve this month. "These are unusually strong job creation numbers."
Fredericks said the low wage growth and limited inflation will make the Federal Reserve proceed cautiously as it raises interest rates. In December, the Fed raised rates for the first time in nine years, but interest rates are still very low.