Stocks fell on Monday as an oilfield shutdown in Alaska pushed crude above $77 a barrel, while caution about a slowing U.S. economy offset relief that the Federal Reserve may decide not to hike rates this week, Reuters reported. The dollar hovered near a two-month low on expectations that Friday's weak U.S. employment data will convince the Fed to keep interest rates on hold at 5.25 percent on Tuesday after 17 straight increases. Government bonds were steady, with yields holding close to the six-week lows they hit in the wake of the non-farm payrolls data, which showed just 113,000 new jobs were added in July. But stocks in Japan racked up their biggest one-day fall in almost three weeks and pan-European indexes were down more than 1 percent in early trade, giving up gains made in the aftermath of the data. "The markets have wanted to see bad news for a while," John Haynes, a strategist at Rensburg Sheppards, said of the jobs numbers. "But when you start to see bad news you wonder whether it will be more than you wished for, whether the medicine will taste quite as sweet as you'd hoped." The chance of a hard landing in the U.S. economy had increased slightly but remained an unlikely scenario, Haynes added. "The corporate environment is sufficiently forgiving that people are making decent profits...we're talking about whether (companies) are going to grow their profits 8 percent or 10 percent, not whether they are going to grow their profits at all next year."
