NEW YORK – Solid employment data failed to extend Wall Street's rally Friday as renewed interest rate concerns spurred profit-taking and left stocks mixed. The major indexes also ended the week mixed.
The Dow Jones industrial average lost 35.06, or 0.32 percent, to 10,877.51. Broader stock indicators were higher. The Standard & Poor's 500 index added 0.41, or 0.03 percent, to 1,265.08, and the Nasdaq composite index rose 6.20, or 0.27 percent, to 2,273.37, a fresh four-year high.
Wall Street had a mild reaction to the Labor Department's announcement that U.S. employers added 215,000 jobs in November, the biggest gain since July. That bested economists' forecast for a 210,000 increase, and October's growth of 44,000.
While the job growth bolstered a brightening economic landscape, some analysts are beginning to fear that the Federal Reserve may push interest rates higher now that the economy appears to be unfazed by hurricanes Katrina and Rita. Upbeat personal spending data sparked a rally Thursday and sent the Dow Jones industrials climbing 106 points.
Meanwhile, an approaching winter storm lifted crude futures a second day amid expectations for the cold weather to drive heating oil demand in the Northeast. A barrel of light crude rose 85 cents to settle at $59.32 on the New York Mercantile Exchange.
Bond prices steadied after three days of losses, with the yield on the 10-year Treasury note flat at 4.52 percent from late Thursday. The dollar was mixed against other major currencies, while gold prices lingered above $500 per ounce.
Wall Street paused from its November rally this week despite support from a raft of government reports showing the economy has withstood a spike in energy costs following the hurricanes. Stocks finished the week mostly lower, ending a five-week winning streak that carried the S&P 500 and Nasdaq to their highest levels since mid-2001.
For the week, the Dow slipped 0.54 percent and the S&P 500 was off 0.25 percent, while the Nasdaq gained 0.46 percent.
Some analysts continue to cast doubt on the recent economic news and point to any number of indicators that could energize or spook a jumpy market. Robert Smith, chairman and chief investment officer of Smith Affiliated Capital, cautioned against being overly optimistic about the jobs data, saying the report is clouded by impending layoffs in the auto sector and hurricane-related rehiring.
"Even though the numerical number is better, the job quality isn't better," as evident in the slight 0.2 percent gain in average hourly earnings, Smith said.
But investors had been braced for the worst and are now wondering if the economy might be growing too quickly, which could bring more interest rate hikes from the Fed. On Wednesday, the Commerce Department said the nation's gross domestic product expanded by 4.3 percent in the July-September quarter.
"I think we're at a point where the data coming in is good and robust, but not strong enough to suggest things are overheating," said Jeff Kleintop, chief investment strategist for PNC Financial Services Group. "The forward-looking data seems to indicate the same."
Kleintop added that he expects volatile trading will continue as the market keeps a close watch on consumer spending during the critical holiday sales period. Early reports have created a mixed picture on this season's retail sales.
And whether the market will press on with its yearend advance: "We've probably seen most of the fourth-quarter rally already," Kleintop said. "We may only see 3 percent to 4 percent more from here."
Investors also mulled comments from Fed Chairman Alan Greenspan, who warned of severe economic consequences if Congress does not make moves to balance the federal spending deficit. Increased government spending to support a retired baby boomer generation could strain the economy by driving up interest rates, he said.
Ford Motor Co. (F)may close five plants employing 7,500, or 6 percent of its North American work force, The Wall Street Journal said Friday. The latest development in Ford's reorganization comes a day after the automaker posted an 18 percent drop in November car sales. Investors were pleased with the restructuring plans, sending Ford up 5 cents to $8.15.
Newspaper publisher Tribune Co. (TRB) said its revenue fell 3.9 percent last month amid declining revenue from its broadcast and entertainment divisions. Tribune slid 29 cents to $31.39.
Luxury hotel chain Fairmont Hotels & Resorts Inc. (FHR) gained $1.81 to $40.60 after billionaire investor Carl Icahn said he plans to launch a $40-per-share tender offer in an effort to capture a 51 percent stake in the company. He also said Fairmont would benefit from selling itself to a larger competitor.
Declining issues led advancers for most of the session, but advancers were ahead of decliners by 17 to 16 on the New York Stock Exchange at the close. NYSE volume of 1.53 billion shares fell behind the 1.89 billion shares changing hands on Thursday.
The Russell 2000 index of smaller companies added 0.36, or 0.05 percent, to 690.57.
Overseas, Japan's Nikkei stock average surged 1.92 percent. Britain's FTSE 100 gained 0.77 percent, Germany's DAX index rose 0.79 percent, and France's CAC-40 was higher by 0.56 percent.