By Jennifer Ablan

NEW YORK (Reuters) - Jeffrey Gundlach, chief executive of DoubleLine Capital, called the May employment report on Friday a "real body blow" and said it means an interest rate increase later this month is an "impossibility."

In a telephone interview, Gundlach also said the U.S. stock market was "incredibly resilient" after the employment report. The Standard & Poor's 500 Index closed down just 6.13 points to end at 2,099.13 on Friday.

"It is a terrible employment report and the unemployment rate fell because people gave up. People are dropping out. There is no way to sugarcoat this report. You really can't sugarcoat it, can you?"

Gundlach, who oversees $100 billion at Los Angeles-based DoubleLine, noted that job gains for April, first recorded at an already light 160,000, were revised down sharply to plus 123,000 jobs, which means "this puts incredible significance for next month's employment report after May's terrible report. It might be three strikes."

It will be interesting to see how Asia opens, Gundlach added. "I wonder if they will have the same nonchalant attitude about the May employment report."

The Bureau of Labor Statistics reported on Friday that employers in the United States added only 38,000 jobs last month, the smallest gain since September 2010.

Earlier this week, Gundlach said the labor market was already softening because of the temporary workers' figures. "When you start to see the figures fall in temporary workers, that means people are not needed. The temp figures are the canary in a coal mine."

Payrolls shrank by 21,000 at temporary-help service providers and are down by about 64,000 so far this year.

Gundlach said the firm purchased 49-year government agency debt securities on Thursday, ahead of the fixed-income rally that ensued on Friday. "I think it is the longest bond I have ever bought in my life. We thought they were very cheap, so we bought them," Gundlach said.

(Reporting By Jennifer Ablan; Editing by David Gregorio and Tom Brown)