U.S. stocks slumped on Friday as the all-important July jobs data failed to cheer investors.

The S&P 500 Index is down 3.61 points, or 0.30 percent, to trade at 1,196.46 at 12:37 p.m ET.  The Dow Jones Industrial Average is up 16.73 points, or 0.15 percent, to trade at 11,400.41.  The NASADQ Composite fell 0.96 percent.

The highly-anticipated Bureau of Labor Statistics (BLS) jobs report came in above expectation, showing that the U.S. economy created 117,000 jobs versus the 85,000 consensus estimate compiled by Bloomberg.

Nevertheless, the markets continued to slide. 

Going into Friday, the market's sentiment was decidedly negative; it was up to the jobs report to cheer the market, which it failed to do.

The 85,000 consensus forecast reflected the bearish forecasts of economists who saw two months of horrendous jobs data (18,000 for June and 54,000 for May), which shattered the view that the U.S. economy is recovering well and growing at a 3 percent annual rate.

For the U.S. jobs to change the perception of a possible recession and begin to reinstate the view of a 3 percent GDP growth rate, it needed to show payrolls gain close to 200,000.

In Europe, Italian and Spanish sovereign bonds are off their Thursday lows.  However, the situation there is still decidedly bearish and lacking in resolution, which adds to the negative global sentiment.