All eyes are on this morning's June jobs report from the Labor Department, and it wasn't a pretty picture.

The economy shed 467,000 jobs last month, a far greater decline than the 325,000 economists had expected. The May number was revised to a loss of 322,000 jobs from an initially reported 345,000.

The unemployment rate rose to 9.5% in June, up slightly from 9.4% in May. It was the smallest increase since November, but the rate is still the highest level since August 1993.

Stocks made gains on Wednesday. The Dow Jones Industrial Average ($INDU) closed up 57 points, or 0.7%, to 8,504. The Nasdaq Composite Index ($COMPX) added 11 points, or 0.6%, to 1,846, and the Standard & Poor's 500 Index ($INX) gained 4 points, or 0.4%, to 923.

The average work week fell to 33 hours, the lowest level since 1964, when data were first recorded. Average hourly earnings were flat at $18.53. Economists were looking for a 0.2% gain in June. Hourly earnings were up 2.7% from June 2008, the smallest year-over-year gain since September 2005.

The economy has shed about 6.5 million jobs since the recession began in December 2007. 

"Payrolls will be going down the rest of the year and the unemployment rate will be rising,'' John Silvia, chief economist at Wachovia, told Bloomberg News. "The challenge for the Obama administration is that we'll have positive economic growth but still no job growth. It's going to be tough on them."

Crude oil fell $1.03 to $68.28 a barrel this morning.

Dividends in focus for second half

The S&P 500 gained 15% in the second quarter, its largest quarterly gain since 1998. It was a different picture for companies and their dividends, however. Only 233 S&P 500 companies raised their dividends in the second quarter, the lowest count and breaking the old record of 265 in 1958, according to Standard & Poor's 500 senior index analyst Howard Rosenblatt.

"The current trend to conserve cash and cut dividends has become defensive, with even relatively healthy companies choosing to reduce payouts. Until we see the economy better, and not just for one quarter, many companies will remain gun shy about parting with their cash," Silverblatt wrote in a note to clients this morning.

Now that the second half of 2009 is under way, the S&P needs to advance 60% to break even for the decade, Silverblatt said.