Solid employment data failed to extend Wall Street's rally Friday as renewed interest-rate concerns spurred profit-taking and left stocks...
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.
At the close of trading, the Dow lost 35.06 to 10,877.51.
Microsoft, one of the 30 Dow stocks, added 12 cents Friday to close at $28.01, up 0.9 percent for the week. Boeing, also a Dow stock, fell 23 cents to $69.44 Friday and was up 0.6 percent for the week.
Broader stock indicators were higher. The Standard & Poor’s 500 index added 0.41 to 1,265.08, and the Nasdaq composite index rose 6.20 to 2,273.37, a fresh four-year high.
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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 0.5 percent and the S&P 500 was off 0.3 percent, while the Nasdaq gained 0.5 percent.
Wall Street had a mild reaction Friday 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 climbing 106 points.
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 sales.
And whether the market will press on with its year-end 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.”