NEW YORK — Stocks retreated on Wall Street after the U.S. government reported that only 80,000 jobs were created in June, the third straight month of weak hiring.
The Dow Jones industrial average dropped 188 points to 12,708 at noon on Friday. The loss wiped out the Dow's gain for the week.
The unwillingness of U.S. employers to add jobs quickly shows that the economy is still struggling three years after the recession officially ended. An average of just 75,000 jobs were created every month in the April-June quarter, far below the 226,000 created every month in the first three months of the year.
"It shows the U.S. economy is losing momentum," said Sharon Stark, chief market strategist at the brokerage firm Sterne Agee.
On the other hand, Stark said it was a good sign that the number of work hours and average hourly earnings increased last month. "It's not a matter of having the ability to hire, rather a matter of not having the confidence," Stark said. "It's a sign of everyone waiting to see what's next."
Of the 30 stocks in the Dow average, only one rose, AT&T. The world's largest producer of aluminum, Alcoa, and Caterpillar, the construction equipment maker, were among the hardest-hit Dow stocks with declines of 3 percent each. Materials and industrial stocks like those are the most likely to suffer if the economy weakens.
The weak jobs report led investors to shift money into low-risk assets. The price of the 10-year Treasury note rose, sending its yield down to 1.54 percent from 1.60 percent late Thursday. The dollar rose against the euro.
The sluggish growth in American jobs comes at a time when the global economy is also hitting the skids. Central banks in Europe and China took action Thursday to prop up their own sliding economies.
The new signs of economic sluggishness around the world sent commodities prices lower. Crude oil dropped $2.72, or 3 percent, to $84.49 a barrel on the New York Mercantile Exchange. Demand for oil is expected to be weaker in the second half of the year. The U.S. is the world's biggest oil consumer, and the prospect of less demand tends to push down prices.
Energy stocks followed the price of oil lower. Peabody Energy fell 96 cents, or 4 percent, to $25.17, while Alpha Natural Resources declined by 29 cents, or 3 percent, to $8.98.
In other trading on Wall Street, the Standard & Poor's 500 slid 18 points to 1,349 and Nasdaq composite fell 49 points to 2,925.
European markets also lost ground. A week after investors welcomed an agreement among European leaders to help Spain and Italy, the borrowing rates of both countries rose again. That means bond investors are less willing to loan those countries money at favorable rates.
The yield on the 10-year Spanish government bond rose 0.22 percentage point to 6.96 percent earlier in the day. That's a very high level and could eventually force Spain to seek more financial support from its neighbors in Europe.
European stock indexes slid. Germany's DAX and France's CAC-40 each lost 1.9 percent. Spain's benchmark index slumped 3 percent.
Other Wall Street stocks making big moves included:
— Seagate Technology. The stock lost 80 cents, or over 3 percent, to $24.83 after the hard drive manufacturer said its quarterly revenue will fall below analysts' expectations because supply problems slowed down its shipments.
— Navistar International. The truck maker's stock fell $1.17, or 4.5 percent, after the company reached a deal with federal regulators allowing it to continue shipping trucks while it makes a transition to a new emission-reducing technology.