By Yasin Ebrahim

Investing.com – The S&P 500 closed lower for the second-straight week Friday, as investors weighed up a “colossal miss” in job gains for November at a time when the Federal Reserve looks likely to step up the pace of monetary policy.    

They fell 0.8% and slipped by 0.17% (59 points), respectively. The dropped 1.9%. Session lows were reached by the major averages.  

“It was a colossal miss,” Darren Schuringa, CEO of ASYMmetric ETFs said in an interview with Investing.com on Friday, referring to weaker-than-expected job gains in November. “When I look at these numbers now, it is concerning for me from an economic strength standpoint.”

Nonfarm payrolls increased 210,000 in November, well below economists’ expectations for 550,000 new jobs.

However, deeper analysis of the monthly jobs report revealed signs that the labor market is strong. While the unemployment rate was lower than expected at 4.2%, it rose to 61.8% due to an increase in labor force participation of 0.2%.  

While the weakness in hiring “could complicate the discussion at the Federal Reserve … [Fed] officials seem to be leaning toward faster monetary policy normalization in response to high inflation,” Desjardins said in a note.

Technology stocks were the worst hit but they did manage to reduce intraday losses.

Microsoft  (NASDAQ:) fell nearly 2%, while Apple (NASDAQ:), Amazon (NASDAQ:), Facebook (NASDAQ:), and Google-parent Alphabet (NASDAQ:) were down about 1%.

Nvidia (NASDAQ) also saw a rise in selling as a result of the Federal Trade Commission’s lawsuit to block its $40 billion purchase of chipmaker ARM Holdings.

“[W]e see the FTC’s decision to sue to block the deal as almost certainly ending the chances of any acquisition,” Wedbush said in a note.

DocuSign (NASDAQ) plunged 42% following its fourth quarter guidance that was softer than expected. This suggested DocuSign’s inability to maintain its pandemic-fueled growth.

In other news, Peloton Interactive  (NASDAQ:) gave up earlier gains and followed the market lower despite Deustche Bank issuing a buy rating on the stock amid expectations that a hybrid approach to fitness – at home and at the gym – is a possibility.

“[W]We believe that the hybrid work model can be extended to fitness and PTON. [Peloton] has plenty of momentum to regain operationally,” Deutsche Bank said in a note.

As the Treasury yields declined sharply, financials saw their prices drop. The 10-year yield fell below 1.4%.

SVB Financial, First Republic (NYSE;), Citizens Financial (NYSE) had sharply lower yields as banks tend to have lower net interest income.

Investors are expressing concern about the economic outlook as the Fed seems ready to tighten monetary policy at a moment when growth could be threatened by the new Omicron version. This is why Treasury yields have fallen.

However, even if this new version proves to have less impact than expected and supply chain problems continue to improve, then the wider market may resume its upward trend. 

“If borders are open and supply chains remain open, then the border will not be closed.” [problems] continue to unravel, then that would support the markets moving higher from here,” Schuringa said.