The release of a fairly friendly September

jobs report this morning helped out the markets for about an hour and then the reality check of earnings warnings settled in and quickly pulled down most major indices.

The

Nasdaq Composite Index took the plunge into the red first, then the

Dow Jones Industrial Average followed it down. Both were lately off their lows but heading down.

Earnings warnings continue to flutter in. Last night a few more from the tech sector hit the Street.

Companies warning last night included Web site designer

Razorfish

(RAZF)

, data storage and imaging systems manufacturer

Imation

(IMN)

, Internet-based software firm

Marimba

(MRBA)

and e-commerce software provider

Concord Communications

(CCRD)

.

Concord Communications was lately losing more than half of its market cap.

Other big tech losers for the day included data storage and optical networking firm

Veeco

(VECO) - Get Report

, which warned of lower-than-expected third-quarter sales and earnings last night and announced the resignation of its president and chief operating officer this morning. The company's stock was getting slaughtered, off 28%.

Tech bellwethers like

Intel

(INTC) - Get Report

,

Cisco

(CSCO) - Get Report

,

Qualcomm

(QCOM) - Get Report

and

Yahoo!

(YHOO)

were adding pressure to the Comp.

The Dow was struggling most under the weight of

J.P. Morgan

(JPM) - Get Report

,

Home Depot

(HD) - Get Report

and and

Citigroup

(C) - Get Report

, which were shaving more than 50 points from the index.

Traders said the market probably won't regain any uphill stride until the earnings warnings flow dries up, oil prices show a steady drop and companies begin to report solid third-quarter earnings and positive outlooks for coming quarters. (Earnings season will start to pick up next week.)

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Sector Watch

The good news is that oil stocks were playing in positive territory again this morning. The bad news: just about everything else was in the red.

The energy stocks were getting a lift from a rebound in oil prices today. Oil prices were clawing their way back up after falling sharply Thursday on

news that the government had awarded contracts for all 30 million barrels of stockpiled crude oil offered to the refineries. The

American Stock Exchange Oil & Gas Index

was up 0.8%, while the

American Stock Exchange Natural Gas Index

was 1.5% higher.

Financials were tanking today. The

American Stock Exchange Broker/Dealer Index

lately tumbled 3.9%, while the

Philadelphia Stock Exchange/KBW Bank Index

was down 3.4%.

The

Philadelphia Stock Exchange Semiconductor Index

lost 2.7%. The sector can thank

Veeco Instruments

(VECO) - Get Report

for that one. It warned of lower-than-expected sales and earnings.

The

S&P Retail Index

fell 2.7%. The

Nasdaq Biotechnology Index

was down 2.6%.

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Bonds/Economy

Bonds have pared their losses thanks to the weakness in stocks. Falling stock prices are seen as a leading indicator of economic activity. They also make bonds more appealing as an alternative investment.

Earlier, bond prices fell as investors concluded that the September

employment report

(

definition |

chart |

source

) makes the

Fed less likely to ease up on interest rates in the near future.

The September jobs report measured a decline in the unemployment rate to 3.9% -- matching the 30-year low it hit in April -- from 4.1% in August. A low unemployment rate is a key indicator of a healthy economy, one that does not require assistance from the Fed in the form of easier monetary policy.

Also indicating that the economy is strong, the employment report counted 252,000 new nonfarm jobs in September. Netting out the loss of 27,000 temporary Census jobs and the return of 75,000 strikers, the underlying increase was 204,000, in line with the recent trend. A shift in monetary policy is unlikely to occur unless there is a pronounced slowdown in the pace of job creation.

The benchmark 10-year

Treasury note lately was unchanged at 99 6/32, yielding at 5.856%.

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