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The stock market tanked on Friday despite the August jobs report coming in slightly lower than expected and dropping significantly from last month, which did little to ease investor concerns about more aggressive interest rate hikes from the Federal Reserve plunging the economy into a recession.


Stocks gave up gains in the afternoon and turned negative: The Dow Jones Industrial Average was down 1.1%, over 300 points, while the S&P 500 lost 1.1% and the tech-heavy Nasdaq Composite 1.3%.

Stocks initially opened higher after the US economy added 315,000 jobs in August—slightly under the 318,000 expected by analysts and far lower than the 526,000 new jobs added in July, according to data released by the Labor Department on Friday.

Though unemployment ticked up to 3.7% from 3.5%, the jobs market has remained strong despite slowing economic growth this year, which Fed officials have pointed to as evidence that the economy can withstand more aggressive rate hikes without falling into a recession.

The labor market is “less tight than it was in July” and “moving in the right direction for policymakers,” meaning that overall this is a “good report for those concerned about inflationary impacts of a tight labor market,” says Jeffrey Roach, chief economist for LPL Financial.

Despite the solid jobs data, stocks added to losses this week and continued to fall amid hawkish comments from Fed officials that the central bank will continue to raise interest rates well into next year and it would take some time before a reversal in monetary policy.

Many Wall Street experts now warn that the prospect of the Fed raising rates “higher for longer” could well spook markets into retesting their June lows, especially as September is historically the market’s worst month on record.