Markets Tank: Is Now the Time to Retreat?

Wall Street will be taking the weekend to regroup after finding itself in a bear den this past week, with the S&P 500 and Nasdaq indices experiencing their worst week of the year. The Dow Jones Industrials (INDEX: ^DJI  ) finished the week down 1.33% on the week, closing Friday at 13,038.

The theme of the week was jobs reports, with Wednesday seeing lower-than-expected private-sector hiring and today bringing April's disappointing nonfarm jobs report, with the addition of 115,000 jobs coming in way below the estimated 155,000. The unemployment rate did drop to 8.1% from 8.2% the month before, but that has less to do with job creations than with discouraged people who quit looking for work. The sad reality is that the jobs market is in for a longer recovery, because the cycle of getting more people employed will be pushed out further until the United States can reach the ideal level of structural unemployment.

Run for the hills
Poor jobs reports can be discouraging, as can falling equity prices, but the truth of the matter is that companies aren't adjusting their strategies or curbing production numbers because of one month's jobs report. At The Motley Fool, we maintain that superior investors find great stocks and invest for the long term, and by doing this, like the companies we invest in, we won't change our strategy over one month's jobs report, either.

I mention this because today we witnessed a strong correction based on weak job creation during April, which conversely scared short-term traders into liquidating positions that were based more or less on speculation. If the negative reports start turning ubiquitous and a negative trend evolves with the potential of long-term effects, then you should take a good look at your investments and see which ones should be fine for the long term and which ones could be permanently hampered by the nature of the evolving crisis.

Of course, everyone has different investing approaches and different aversions to risk, so to each his own. With that said, let's review a few Dow companies that had a more volatile day than their fellow components.

Bank of America (NYSE: BAC  ) -- down 3.25%
The banking sector was hit a bit harder than the market in general today, with Bank of America performing the worst of all Dow components, finishing the day below $8 for the first time since the beginning of March. JPMorgan Chase (NYSE: JPM  ) didn't fare much better, finishing the day down 2.93%.

Chevron (NYSE: CVX  ) -- down 2.14%
Another sector hit particularly hard was energy, which was down 3% in the S&P 500. Chevron, as well as ExxonMobil (NYSE: XOM  ) , traded substantially lower today as oil futures dropped below the $100 mark. A building oil supply, weak jobs reports, and slowing GDP growth in China have been huge catalysts in the current price retreat in oil.

The takeaway
With the worst week of the year now in the books, and what are sure to be more turbulent times ahead, I'd like to offer you a report that details several excellent stocks that have not only name recognition but also outstanding dividends, which will help boost your portfolio's return. Make sure to check out this free report, which offers great advice in easy-to-understand terms -- but do it now, because it will be available for only a limited time.

Joel South owns shares of ExxonMobil. The Motley Fool owns shares of JPMorgan Chase and Bank of America. Motley Fool newsletter services have recommended buying shares of Chevron and ExxonMobil. The Motley Fool has a disclosure policy. We Fools don't all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. Try any of our Foolish newsletter services free for 30 days.


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