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Stocks skid on concerns about slower hiring; growth

A statue of George Washington stands at Federal

A statue of George Washington stands at Federal Hall near the NYSE on July 8, 2015. Photo Credit: AP / Bebeto Matthews

Stocks took their biggest loss in more than six weeks Thursday as investors reacted to mounting evidence that hiring has slowed down. Energy and health care companies fell sharply, and so did retailers.

Stocks slumped after ADP, a payroll processing company, said private businesses added 158,000 jobs in June, fewer than investors had expected. The losses deepened in afternoon trading.

Bond prices fell and yields jumped, which hurt companies that pay large dividends, such as major drug companies and real estate investment trusts. Retailers sank after L Brands, the parent company of Victoria’s Secret, reported weak sales in June.

The ADP survey was the latest piece of evidence that hiring has slowed down in recent months. That has investors worried, because the European Central Bank may start raising rates soon and rates are already rising in the U.S. Higher interest rates tend to slow down economic growth.

“If rates rise meaningfully, it will end up hampering growth expectations,” said Krishna Memani, chief investment officer at Oppenheimer Fund.

The Standard & Poor’s 500 index dropped 22.79 points, or 0.9 percent, to 2,409.75. The Dow Jones industrial average fell 158.13 points, or 0.7 percent, to 21,320.04. The Nasdaq composite sank 61.39 points, or 1 percent, to 6,089.46.

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