US markets take a breather

US stock markets, beaten down by negative economic reports, will have a holiday-shortened week to regroup before the company earnings season gets underway.

Over the past week, the Dow Jones Industrial Average shed 4.51 percent, closing on Friday at 9,686.48 points, its lowest level since October 5. The tech-heavy Nasdaq composite index dropped 5.92 percent to 2,091.79 points.

The US markets will be closed on Monday in observance of the Independence Day holiday.

Only one key economic report is due in the holiday-shortened week: The Institute for Supply Management's index on activity in the services sector, on Tuesday. The major market indices spent this week mired in red, under pressure from a slew of poor economic indicators.

"It was one ugly week," said Ryan Detrick at Schaeffer's Investment Research, "and the recent data raises serious questions about the overall state of the economy."

The Labor Department's jobs report on Friday did not help to dampen recovery fears. The economy shed 125,000 jobs, more than expected, while the unemployment rate fell to 9.5 percent from 9.7 percent as more than a half million workers exited the workforce.

Most analysts had expected it to rise to 9.8 percent.

Lindsay Piegza at FTN Financial called June "a pretty bad month." "We basically stalled. We're not falling off a cliff but we slowed from the two previous months.

The blue-chip Dow plunged 10 percent in the April-June period, the first quarterly decline since the indices rebounded from March 2009 lows.