When hiring slumps, so do stock prices.
The Dow Jones industrial average fell as much as 87 points after a company that tracks payrolls said the U.S. added far fewer jobs in April than in March. The Dow ended the day down 10.75 points, at 13,268.57.
It was a turn from the day before, when investors chose to focus on a couple of positive reports on U.S. manufacturing and sent the Dow up 66 points to its highest close in more than four years.
While the market's day-to-day fluctuations may be difficult to predict, some investors say they're certain that stocks will generally climb for the rest of the year. As justification, they cite strong first-quarter earnings.
Of the 330 companies on the S&P 500 that have reported first-quarter earnings, 77 percent have beaten the estimates of stock analysts, said John Butters, senior earnings analyst at FactSet, a provider of financial data.
"The market has room to run," said Karyn Cavanaugh, market strategist with ING Investment Management in New York. "It doesn't always go up in a straight line."
The report on private sector hiring weighed on investors, who see jobs as the key ingredient to an economic recovery.
The payroll processor, ADP, said U.S. businesses added 119,000 jobs in April, down from 201,000 in March. The government releases its monthly figures, which include the public sector, on Friday. The two reports can vary sharply.
Another jobs report from Europe underscored the gravity of the continuing debt crisis there. The 17 countries that use the euro reported that unemployment rose to 10.9 percent in March, the highest since the euro launched in 1999.
There was also good news out of Europe, even if it didn't seem to sway investors. Standard & Poor's lifted Greece's credit rating out of default, noting how the country had recently secured a massive writedown on its debt to private investors.
Germany also reported that the number of people seeking work in April slipped below 3 million, a psychologically important barrier that it hasn't broken in that month for two decades.
Todd Salamone, director of research for Schaeffer's Investment Research in Cincinnati, downplayed concerns about Europe. Investors have had a long time to digest any bad news and shouldn't be too shaken by daily developments, even if the headlines seem panicky, he said.
"U.S. stocks have become more resilient, especially to the European headlines," Salamone said. "Any negative news out of Europe is not a major surprise like it was early last year."
In U.S. stocks, one of the biggest losses came at Chesapeake Energy, which plunged 15 percent. The company had reported a first-quarter loss after the market closed Tuesday. It is also under fire for a massive pay package to CEO Aubrey McClendon and questions about his taking out big loans from companies that do business with Chesapeake. This week, the company stripped McClendon of his role as board chairman.
In an earnings call Wednesday, McClendon said he was "deeply sorry for all the distractions" but also said there was "a great deal of misinformation" circulating about himself and the company.
Ascena Retail Group shot up more than 10 percent after announcing it plans to buy rival Charming Shoppes. Ascena runs dressbarn, maurices and Justice, which are clothing chains for women and girls. The purchase will add Lane Bryant, Catherines and Fashion Bug to its portfolio.
Energizer Holdings, parent of the eponymous batteries, popped more than 9 percent after reporting higher revenue and earnings. The company said that sales of Schick razors helped results.