NEW YORK -- Safety first. That appears to be the new motto for investors trying to figure out how bad the emerging slowdown in U.S. economic growth is going to be.

A disappointing jobs report sent investors out of stocks and the dollar Friday and into assets perceived as being safer. Foreign currencies and gold rose, as did bond prices, which sent interest rates lower. The yield on the two-year Treasury note hit a record low.

Stocks sank for most of the day but pared their losses in late afternoon trading. The Dow Jones industrials ended down 21 points after being down as much as 160 earlier in the day. Broader major indexes also slipped.

A closely watched monthly employment survey from the Labor Department confirmed what investors have been fearing: The U.S. economic recovery is weakening. Private job growth was just 71,000 in July. That's below what analysts had hoped for and far shy of the level that would be needed to reduce the unemployment rate, which remained steady at 9.5 percent.

It was the latest sign that a slowdown in U.S. growth is the real problem with the global economy, not the European debt crisis that had financial markets in a tizzy for much of the spring.

U.S. stocks fell on the report, sapping a strong upward trend from the past four weeks. The yield on the two-year Treasury reached a record low of 0.50 percent, and the yield on the 10-year Treasury is at its lowest level since April 2009. The dollar dropped to a 15-year low against the Japanese yen.

Stocks have been volatile since reaching their highest level of the year in late April. They turned lower throughout May and part of June as worries about Europe's debt situation peaked. In July, a wave of strong earnings from major U.S. companies like Caterpillar Inc. and UPS Inc. propelled stocks higher. The Dow average climbed 7.1 percent last month, its strongest one-month gain in a year.

It's not yet clear whether Friday's downturn was a sign of more trouble to come or just a temporary setback on a generally upward trajectory for the market. If stocks are going to get more fuel to advance, they will have to get it from someplace other than earnings since the corporate reporting season is winding down. That leaves the focus on the economy, and the news there has been discouraging. Housing, retail sales, personal income and now jobs reports have all been downbeat.

"The tension will play out for the rest of the year between corporate earnings and employment," said Sarah Hunt, a research analyst at Alpine Funds. At some point, Hunt said, earnings will have to slow to match the weaker economy or employment will have to pick up to help maintain strong earnings.

On top of that, Europe's economy is showing stronger signs of life than was expected just a few months ago, when mounting government debt there was hurting stocks worldwide. A healthier Europe gives investors another place to stash money if the U.S. economy remains weak.

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The euro has recovered nearly all of its losses from the worries over European government debt that flared up earlier this year. The euro is now at a four-month high against the dollar after touching a four-year low in early June.

While stocks take a turn lower, bond investors already have been anticipating that the economy was headed for trouble.

Even while the stock market was surging ahead in early June and then again for most of July, yields on Treasury notes have been heading steadily lower since early April as more money flows into ultrasafe Treasurys.

Michael Strauss, chief economist and market strategist at Commonfund, said investors in the bond and stock markets are lining up on opposite sides of the debate about the strength of the economy.