NEW YORK — Stocks closed lower Friday for just the second time in two weeks as a disappointing monthly jobs report prompted investors to dial back recent optimism about the economic recovery.
The Dow Jones industrial average finished down 62.29 points, or 0.5 percent, to 12,657.20, its biggest loss since June 24. The blue-chip index pared losses during the final hour of trading; it fell as much as 152 points earlier in the session.
Bank of America dropped 2 percent, while General Electric declined 1.6 percent.
The Standard & Poor’s 500 shed 9.42 points, or 0.7 percent, to 1,343.80, as financials, industrials and energy stocks struggled. All 10 of the S&P 500 sectors closed in negative territory.
The technology-heavy Nasdaq composite fell 12.85 points, or 0.5 percent, to 2,859.81.
Stocks tumbled from the opening bell after the Labor Department reported nonfarm payrolls rose 18,000 last month, a fraction of what was expected. Small gains in the private sector were just enough to outweigh continued government job losses.
The jobless rate, obtained from a separate household survey, increased for a third straight month to 9.2 percent in June, the highest since December 2010.
The tone was further dampened by comments from President Barack Obama following the jobs report. He acknowledged that the employment data confirm policy makers have a “big hole” to fill on stimulating job growth.
“It was obviously a shock, although in retrospect, I don’t think we should be inordinately surprised by the report considering the weakness in the second quarter,” said Bruce McCain, chief investment strategist at Key Private Bank. “Investors got their hopes up too far, too fast, and we’re paying the price in disappointment.”
Ahead of the report, investor optimism had zoomed higher over the past two weeks on improving manufacturing news and retail-sales data as well as a big jump in private-sector employment as measured by Automatic Data Processing.
