1st LD Writethru: U.S. stocks slide despite upbeat jobs report

U.S. stocks reversed early gains to drift lower despite strong jobs data Friday, as worries about an earlier Federal Reserve rate hike weighed on investor sentiment.

The Dow Jones Industrial Average fell 60.59 points, or 0.34 percent, to 17,824.29. The S&P 500 dipped 7.05 points, or 0.34 percent, to 2,055.47. The Nasdaq Composite Index was down 20.70 points, or 0.43 percent, to 4,744.40.

U.S. jobs data came in much stronger than expected. Total nonfarm payroll employment rose by 257,000 in January, well above market estimates of 230,000, including the biggest increase in private-sector job creation since 1997, and the unemployment rate was little changed at 5.7 percent, said the U.S. Labor Department Friday.

Moreover, average hourly earnings for all employees on private nonfarm payrolls increased by 12 cents to 24.75 U.S. dollars in January, following a decrease of 5 cents in December. Over the year, average hourly earnings have risen by 2.2 percent.

The favorable jobs data gave rise to traders speculation that the Fed will begin raising interest rates by mid-year. The Fed has held rates near zero since December 2008, and it reiterated in January a pledge to remain "patient" on raising rates.

"This unabashedly strong report follows on the heels of strength in November and December. The drop in average hourly pay in December, the one thing people were worried about last month, was more than resolved with an outsized increase in January. With three-month average job growth of 336,000, the Fed may start thinking about liftoff before June," said Chris Low, chief economist at FTN Financial, in a note.

Putting a damper on the stock market, Standard & Poor's on Friday downgraded Greece's long-term rating to B-minus from B and kept the rating on Credit Watch negative, which exerted sorts of uncertainties on the European economy.

In corporate news, Twitter's shares soared 16.36 percent to 48. 01 U.S. dollars apiece Friday after the company beat expectations on earnings and revenue, despite disappointing user growth figures.

After Thursday's closing bell, Twitter reported that its revenue for the fourth quarter of 2014 totaled 479 million dollars, an increase of 97 percent compared to 243 million dollars in the same period in 2013.

Shares of Moody's Corp. surged 5.11 percent to 98.04 dollars apiece after the credit ratings company delivered solid fourth- quarter results of 2014, along with a 2015 outlook in line with market consensus.

Latest data from Thomson Reuters showed that S&P 500 companies' per-share earnings in the fourth quarter are expected to grow 6.4 percent year on year, while revenue growth is forecast to increase 1.8 percent. A total of 322 companies in the S&P 500 have reported earnings for the fourth quarter of 2014 to date.

Despite Friday's decline, the three benchmark indices still posted big gains for the week, with the blue-chip Dow jumping 3.8 percent, the broader S&P 500 rising 3.0 percent,and the tech- heavy Nasdaq up 2.4 percent. Endite