By Michael P. Regan March 31 (Bloomberg) -- U.S. stocks fell, European shares erased gains and Treasuries advanced after a private report showed American employers unexpectedly cut jobs this month. Gold rallied and the dollar slid. The Standard & Poor’s 500 Index lost 0.6 percent at 9:50 a.m. in New York, trimming a fourth-straight quarterly advance. The Stoxx Europe 600 Index lost 0.6 percent. The yield on the 10-year Treasury note fell 4 basis points to 3.82 percent. Gold for immediate delivery increased 1.1 percent to $1,115.72 an ounce, while the Dollar Index slipped 0.5 percent to 81.068. U.S. companies cut an estimated 23,000 jobs this month, ADP Employer Services reported, compared with a median economist forecast for an increase of 40,000 positions in a Bloomberg News survey. The report spurred concern that economists have been too optimistic about the rebound in employment two days before a Labor Department report forecast to show the biggest growth in jobs in three years. “The ADP report caused jitters,” said E. William Stone, who oversees $102 billion as chief investment strategist at PNC Wealth Management in Philadelphia. “Our view is that the recovery is sustainable, but I don’t think you can officially call it right now. When you get a question out there about the future recovery, you’re going to see market jitters.” The S&P 500 trimmed gains on the final day of the quarter. The benchmark index has climbed 5 percent since Dec. 31, poised for its best first-quarter rally since 1998. U.S. equities extended declines after the Institute for Supply Management- Chicago Inc. said its business barometer fell to 58.8 from 62.6 in February, trailing the median economist estimates of 61. Dow Retreats From High Merck & Co., Boeing Co. and Verizon Communications Inc. led the Dow Jones Industrial Average down from an 18-month high. Goldman Sachs Group Inc. and Morgan Stanley retreated after Keefe Bruyette & Woods Inc. lowered its earnings estimates, citing weaker investment banking results. Banks led European shares lower, with BNP Paribas tumbling 3.1 percent in Paris after WestLB AG cut its recommendation on the shares. Ireland’s benchmark ISEQ Index gained 0.4 percent, erasing most of a 1.5 percent advance after the U.S. jobs report. The earlier rally came as the National Asset Management Agency announced details of its plan to revive the financial system. Bank of Ireland Plc jumped 21 percent after saying it expects to avoid state control by raising most of its 2.7 billion-euro target for capital from private investors. Irish Banks Credit-default swaps protecting Bank of Ireland bonds fell 7 basis points to 191, Anglo Irish Bank Plc dropped 3 basis points to 348 and Allied Irish Bank declined 6 basis points to 196, according to CMA DataVision prices. The MSCI Asia Pacific Index fell 0.5 percent, the steepest retreat since March 24. Greek bonds fell, with the yield on the 10-year bond rising 7 basis points to 6.51 percent. The yield premium investors demand to hold Greek 10-year bonds instead of benchmark German bunds increased 10 basis points to 343 basis points, the highest since March 22. The seven-year note, the first security sold by Greece since the European Union and International Monetary crafted a possible aid package last week, extended declines in its second day of trading. The yield climbed to 6.3 percent, from 6.27 percent yesterday and 6 percent when the security was issued on March 29, according to Royal Bank of Scotland Group Plc prices on Bloomberg. Greece needs to borrow 11.6 billion euros ($15.6 billion) before the end of May after April funding was “taken care of,” Petros Christodoulou, director general of the Public Debt Management Agency, said in a Bloomberg Television interview. Precious metals rallied. Platinum advanced 1.7 percent to $1,646 an ounce in London and palladium added 2 percent to $480.25 an ounce. Crude oil rose 1.2 percent to $83.32 a barrel in New York trading. To contact the reporter for this story: Michael P. Regan in New York at mregan12@bloomberg.net.

Source