Stocks Plunge as Job Market Weakens

Stocks plunged Friday on news that U.S. employment fell in August for the first time in four years.

The economy shed 4,000 jobs last month, the Labor Department reported, well below estimates of a 110,000-job increase.

The news raised fears that the growing credit market crisis could send the economy into recession and will also put pressure on the Federal Reserve to cut interest rates when it meets on Sept. 18.

The major stock averages lost 2% on the day, with Dell’s 4.6% loss leading Nasdaq most actives and Apple falling for a third straight day on iPhone price cuts.

National Semi lost 3% after reporting a quarterly sales decline, and American Software tumbled after missing estimates.

InterDigital was a rare bright spot, soaring 14% after raising guidance.

The Nasdaq fell 48 to 2565, the S&P 500 plunged 25 to 1453, and the Dow tumbled 250 to 13,113. Volume rose to 3.15 billion shares on the NYSE, and 1.91 billion on the Nasdaq. Declining issues led by a 25-7 margin on the NYSE, and 23-6 on the Nasdaq. Downside volume was 90% on the NYSE, and 89% on the Nasdaq. New highs-new lows were 21-104 on the NYSE, and 46-110 on the Nasdaq.