Stocks Fall on Oil, Labor Data

Stocks slumped Friday as investors fretted over rising oil prices and digested a mixed September unemployment report that showed weaker-than-expected job growth.

The Dow Jones industrial average lost 70.20 points, or 0.70 percent, to end the session at 10,055.20. The technology-laced Nasdaq Composite Index tumbled 28.55 points, or 1.47 percent, to end lower at 1,919.97, while the Standard & Poor's 500 index was down 8.51 points, or 0.75 percent, to end at 1,122.14.

For the week, the Dow was down 1.35 percent, the S&P 500 was off 0.83 percent, and the Nasdaq was down 1.14 percent.

Friday's trading pace slowed to moderate after heavier volumes during the week. About 1.3 billion shares changed hands on Friday on the New York Stock Exchange (search ), while about 1.7 billion traded on Nasdaq.

Declining stocks just barely outnumbered advancing ones on the NYSE, while on Nasdaq, more than two stocks fell for every one that rose.

Oil prices lubricated the downward slide Friday. A strike in Nigeria added to continuing threats to the U.S. supply of oil during the winter months and drove the price of U.S. light crude to settle at $53.31, up 64 cents on the day. Oil passed the $53 per barrel mark this week on delays with production in the Gulf of Mexico in the wake of Hurricane Ivan.

The recent spike in oil prices, which have risen 60 percent this year, has weighed on the market as investors worry that high energy costs will bite into corporate profits.

Adding to investors' woes was a disappointing Labor Department report that showed U.S. businesses added 96,000 jobs to payrolls in September. Analysts had expected 148,000 jobs to be added.

However, the Labor Department said the unemployment rate in September held steady at 5.4 percent.

"The jobs figure was clearly disappointing, and energy prices are still hanging in there," said Scott Brown, senior economist at Raymond James. "It's not a disaster, but the jobs number just isn't good enough. The markets are taking it fairly well, considering, but it doesn't help."

The jobs data offset a positive report from conglomerate General Electric Co. (GE), which said third-quarter earnings were higher. GE, whose operations range from jet engines to NBC Universal, is viewed as an economic barometer for its wide range of businesses. GE stock was down 15 cents at $33.80.

Among blue-chip drug stocks, Johnson & Johnson (JNJ ) dropped 1.1 percent, or 60 cents, to $55.32 after it warned doctors that patients taking its rheumatoid arthritis drug Remicade may have a higher risk of lymphoma, a blood cancer.

Merck & Co. Inc.'s (MRK) shares fell 1 percent, or 41 cents, to $30.57. Merck pulled its arthritis drug Vioxx off the market last week after a study showed it doubled the risk of heart attack and stroke.

Pfizer Inc. (PFE), also among the 30 stocks in the Dow, dropped 0.6 percent, or 19 cents, to $29.80 after Alpharma Inc. (ALO) Friday started to sell a cheaper generic version of Pfizer's $3 billion-a-year epilepsy drug, Neurontin (search ). Alpharma went ahead with its generic drug launch without waiting for a court ruling on Pfizer's request to block the copycat drug.

Oil stocks helped trim some of the losses on the Standard & Poor's 500 index and the Dow. Exxon Mobil Corp. (XOM) rose 10 cents to $49.84 and ConocoPhillips (COP ) climbed 94 cents to $88.08.

Boeing Co. (BA) fell 2.4 percent, or $1.22, to $50.10, after U.S. House and Senate negotiators ruled out an Air Force plan to lease modified 767 aircraft as refueling planes and said Boeing would have to compete for any tanker maintenance contract.

Manpower Inc. (MAN), the world's second largest staffing company, fell 3 percent, or $1.32, to $44.24, and Robert Half International Inc. (RHI), a specialized staffing company, fell 3.3 percent, or 87 cents, to $25.46 after the bleak payroll figures.

Alcoa Inc. (AA), the world's biggest aluminum producer, shed 2 percent, or 68 cents, to $33.40. Alcoa reported only a slight rise in third-quarter profits Thursday, and a JP Morgan analyst lowered his fourth-quarter earnings estimate.

Semiconductor maker Advanced Micro Devices Inc. (AMD) met analysts' forecast with earnings of 12 cents per share for the quarter, but its sales were slightly less than investors had hoped for. AMD slipped 61 cents to $13.50.

AMD rival Intel Corp. (INTC ) which reports earnings Tuesday, fell 3.3 percent, or 69 cents, to $20.55.

AT&T Corp. (T) rose about 2 percent, or 27 cents, to $15.31 a day after the U.S. telephone company said it would cut 7,000 jobs and reduce the value of assets by $11.4 billion. The move is part of AT&T's decision to withdraw from selling to consumers.

Krispy Kreme Doughnuts Corp. (KKD) tumbled 4.3 percent, or 56 cents, to $12.51 after the company announced that the U.S. Securities and Exchange Commission has opened a formal investigation into the company's operations.

The Russell 2000 index of smaller companies was down 6.95, or 1.2 percent, at 575.65.

Overseas, Japan's Nikkei stock average fell 0.1 percent. In Europe, Britain's FTSE 100 closed flat, France's CAC-40 slid 0.5 percent for the session, and Germany's DAX index dropped 0.7 percent in late trading.

Reuters and The Associated Press contributed to this report.