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Morning Market Roundup: Unemployment & Consumer Spending up, Stocks Nosedive

Business

"It’s an indictment of Obama’s stagnation and incompetence at economics."

Here’s what’s important in the business world:

U.S. Unemployment: As already mentioned on The Blaze, only 69,000 jobs were added in May. This, of course, has driven the unemployment rate back up to 8.2 percent.

“The dismal jobs data will fan fears that the economy is sputtering. It could also damage President Barack Obama's re-election prospects. And it could lead the Federal Reserve to take further steps to help the economy,” the AP reports.

Adding to these dismal jobs numbers is the fact that the Labor Department also revised its figures for the previous two months. As it turns out, 49,000 fewer jobs were created than originally reported.

But don’t worry, Rep. Barney Frank (D-MA) says President Obama has turned this economy around.

“There is no positive spin that can be put on this report. It’s an indictment of Obama’s stagnation and incompetence at economics,” writes Ed Morrissey. “That doesn’t mean Obama won’t try to spin this as a positive report, so be sure to keep an eye on his response today.”

EU Unemployment: Unemployment across the 17 countries that use the euro stuck at 11 percent in April -- the highest level since the single currency was introduced back in 1999.

The eurozone's stagnant economy left 17.4 million people out of a population of some 330 million without a job, with rates continuing to climb in struggling Spain, Portugal and Greece. The EU's Eurostat office said 110,000 unemployed were added in April alone.

Friday's seasonally adjusted figures follow on from last week's European Union summit, where leaders including the new socialist President of France Francois Hollande called for measures to boost growth and employment to offset the impact of stringent austerity policies. Experts argue that targeted measures could help get people, especially youngsters, off the unemployment lines.

U.S. Stocks: U.S. stock futures plummeted Friday after the release of a report on the job market that was far weaker than economists expected.

Dow Jones industrial average futures, which fell 100 points before the report came out at 8:30 a.m. EDT Friday, tumbled an additional 100 points within minutes.

A loss of 200 points when the stock market opens at 9:30 a.m. would wipe out what was left of the Dow's gain for the year.

The price of gold, which was trading at about $1,550 an ounce before the report, shot up almost $40. For much of the past three years, investors have seen gold as a safe place to put their money during turbulent economic times.

Consumer Spending: Consumer spending edged up modestly in April but personal income growth was the slowest in five months, raising concerns about the ability of Americans to keep spending in the future.

Consumer spending increased 0.3 percent in April following a revised 0.2 percent gain in March, the Commerce Department said Friday.

Consumer spending accounts for 70 percent of economic activity. Economists hope consumers will keep spending to support further economic growth. But the concern is that incomes have been lagging in this sub-par recovery, meaning households have less to spend. The small April income gain will add to those worries.

Worries about income growth will likely increase in light of a separate report Friday showing that the nation created just 69,000 jobs in May, the fewest in a year. The unemployment rate rose to 8.2 percent from 8.1 percent in April, the first increase in 11 months. Weak job growth translates into weak income growth.

The Associated Press contributed to this report.

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