Stocks are sliding Friday, dragged down by a weaker than expected U.S. jobs report. At midday, the S&P/TSX composite index is down 34 points to 7,224.

Volume is quite light at 83.3 million shares, which is to be expected ahead of a long weekend in the summer. Selling volume outweighs the buying by a seven to six ratio. And, losers are outnumbering winners about nine to eight.

U.S. payrolls dropped when economists expected an increase. A dip in the unemployment rate resulted from people abandoning their search for jobs.

There was good news in the manufacturing ISM report, which showed solid indications for the factory sector.

The weakness in the U.S. recovery scenario is weighing on Canadian banks, which are down 0.7%. There is also selling in real estate, consumer stocks, health care and industrials. Golds and techs are a little stronger, but nothing is up as much as 1%.

The big gainer today is Research in Motion, which is up 13% on talk that it is ripe to be acquired by Hewlett-Packard Co. This move is helping to overcome weakness in names such as Nortel, down 2% in moderate volume.

The banks are really weighing on the market, led by Bank of Montreal, which is off 1.7% in decent volume. CIBC, Scotiabank and Manulife are down, too. Fairfax is down almost 5% as well, after releasing its Q2 results after the bell Thursday.

The market’s recent whipping boys, such as Stelco and Air Canada, are receiving another flogging today. There is also weakness in names such as Laidlaw, Cinram International, Canadian Tire, QLT, Methanex, Ivanhoe Mines and Purcell Energy.

The stocks that are making gains are mainly doing it with positive news. Allstream is up following its strong earnings yesterday. VSM Medtech is up almost 9% after it reported that during yesterday’s second quarter conference call it disclosed that it had increased its outlook for magnetoencephalography sales by 20%.

There are also gains in E-L Financial, Linamar, Bema Gold, Vitran, Telesystem International Wireless and MediSys Health.

In earnings news, Cabletel Communications says it anticipates reporting lower revenues of approximately $9 million, compared with $15 million reported in the same second quarter of 2002 and $11 million for the first quarter of 2003. It also expects to report an increased net loss and that it expects to take a restructuring charge, the total amount of which has not yet been determined. T

Oncolytics Biotech Inc says that it lost $3,955,290 in the second quarter. Cytovax Biotechnologies lost $1.1 million.

Nexfor reported earnings for the second quarter of 2003, before the restructuring charge at the eastern paper operations, were $14 million, compared with earnings of $1 million in the first quarter of 2003, and earnings of $12 million in the second quarter of 2002.

Four Seasons Hotels latest quarterly net loss was $1.3 million, as compared with net earnings of $18.1 million for the comparable period in 2002. The decline in net earnings is primarily attributable to a non-cash, unrealized foreign exchange loss. Excluding the foreign exchange loss and legal and other enforcement cost items, and the tax effect thereof, adjusted net earnings would have been $8.9 million in the second quarter of 2003.

In New York, stocks have been selling off all morning since the jobs report came out, ignoring the positive ISM news. The Dow Jones industrial average is down 71 points to 9,163. The Nasdaq composite index is off 16 ticks to 1,719. The S&P 500 has lost eight points to 981.

The S&P/TSX Venture index is holding up quite well, losing a mere point to 1,213. Volume is robust at 20.4 million shares. Saxony Explorations is leading the trade, down 1.5¢ to 10.5¢ on 1.5 million shares.