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* Non-farm payrolls rise misses estimates but unemployment
* DocuSign plunges after disappointing forecast
* Vix hits highest level since January
* Indexes down: Dow 0.17%, S&P 0.91%, Nasdaq 2.07%
Dec 3 (Reuters) - Wall Street's major indexes fell in choppy
trading on Friday, with the Nasdaq falling more than 2%, as
investors digested mixed economic data and grappled with
uncertainty around the potential impact of the Omicron
After opening higher, Wall Street could not hold its gains
for long. The Labor Department's report, ahead of the session's
open, showed that while nonfarm job growth rose less than
expected in November the unemployment rate dropped to 4.2%, the
lowest since February 2020, and wages increased.
Separately, a measure of U.S. services industry activity hit
a record high in November. Both sets of data
appeared to influence investor expectations for the U.S. Federal
Reserve's next move towards tightening its policy. Fed Chair
Jerome Powell said this week that the central bank will consider
a faster wind-down of its bond-buying program, a move seen by
some as opening the door to earlier interest rate hikes.
"The market may think the jobs report was strong enough to
keep the Fed on its path for accelerating bond purchase
tapering, said Shawn Snyder, head of Investment Strategy at Citi
US Consumer Wealth Management.
Investors were viewing the data alongside reports about
Omicron's spread to dozens of countries without any clarity on
the severity of the disease or the level of protection provided
by existing COVID-19 vaccines.
"There's still the lingering uncertainty what Omicron will
mean and if it weights on growth in the future. But it's a
really strong (economic report) and most signs are pointing to
an accelerating economy in the fourth quarter," said Snyder,
adding that this could potentially be weighing on technology
shares, which is less dependent on the economy for growth.
By 2:29 p.m. ET (1929 GMT), the Dow Jones Industrial Average
fell 239.39 points, or 0.69%, to 34,400.4, the S&P 500
lost 63.36 points, or 1.38%, to 4,513.74 and the Nasdaq
Composite dropped 376.85 points, or 2.45%, to 15,004.47.
However, while the technology index, down 2.6%,
was leading losses among the S&P 500's 11 major sectors, the
S&P's two sole sector gainers were also defensive with consumer
staples up 1% and utilities up 0.6%.
The economically sensitive Dow boasted the lowest
percentage decline of Wall Street's three major averages on the
day and other cyclical sectors like industrials,
materials also outperformed.
The S&P, the Dow and the Nasdaq were all set to register
declines for the week in which they swung wildly from day to day
as investors reacted to the Omicron variant and to Powell's
commentary about the Fed's next moves.
"Even if Omicron is not too virulent, all of this, coupled
with a hawkish Fed, speaks to increased caution for risk assets,
although if corporate profits continue upward, overall equities
should still rise except perhaps many of the most expensive
ones," said John Vail, chief global strategist at Nikko Asset
Wall Street's fear gauge, the CBOE Market Volatility index
, hit a session high in afternoon trading, going above 35
for the first time since late January.
DocuSign Inc plunged 41% after the electronic
signature solutions firm forecast downbeat fourth-quarter
Declining issues outnumbered advancing ones on the NYSE by a
3.35-to-1 ratio; on Nasdaq, a 3.86-to-1 ratio favored decliners.
The S&P 500 posted nine new 52-week highs and six new lows;
the Nasdaq Composite recorded 14 new highs and 630 new lows.
(Reporting by Sinéad Carew in New York; Devik Jain, Anisha
Sircar and Sruthi Shankar in Bengaluru; Editing by Marguerita
Choy and Maju Samuel)