Stocks End Lower as Jobs Report Takes Toll

The rally stalls after a big jump in November unemployment.
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Updated from 3:40 p.m. EST

Stocks ended lower in the last session of the week as November's dismal unemployment report gave investors pause. The dour news overshadowed some positive developments from the technology sector.

The

Dow Jones Industrial Average finished down 49.68 points, or 0.49%, to 10,049.46. The

Nasdaq lost 33.03 points, or 1.61%, to 2021.24, and the

S&P 500 ended off 8.80 points to 1158.30.

The Labor Department said nonfarm payrolls fell by 331,000 in November after tumbling by a revised 468,000 in October. The unemployment rate rose to 5.7%. The consensus forecast of economists had been for about 190,000 jobs lost and an unemployment rate of 5.6%.

The University of Michigan's preliminary consumer sentiment index was more optimistic. It came in at 85.8, slightly ahead of expectations. Bonds, which rose on the jobless claims, fell on the sentiment number, with the 10-year Treasury losing 1 3/32 at 98 26/32 to yield 5.15%. The 30-year bond fell 1 31/32 to 96 26/32, yielding 5.60%.

Tech investors could fall back on positive outlooks from two microprocessor giants. Both

Intel

(INTC) - Get Report

and

Advanced Micro

(AMD) - Get Report

said they will post higher-than-expected revenue in the current quarter, boosted by strong holiday demand for computers. But Intel lost 92 cents, or 2.69%, to $33.24, while AMD advanced $1.65, or 10.2%, to $17.90.

Halliburton

(HAL) - Get Report

fell $9.20, or 44.1%, to $11.65, after a jury ordered it to pay $30 million in an asbestos suit. The shares are near their 10-year low. Subsequently, Salomon Smith Barney downgraded the stock to neutral from buy, citing the prospect of future lawsuits.

Integrated Device Technology

(IDTI) - Get Report

warned that third-quarter revenue would be lower than previously expected, citing weakening conditions in Europe and Japan. The company now foresees a decrease of 15% to 20% from its second-quarter revenue of $97.1 million. As a result, the company's stock has dropped $5.28, or 17%, to $25.80.

Overseas, London's FTSE 100 reversed course and closed down nearly 2% to 5265 while Germany's Xetra Dax ended down 1.4% at 5199. Japan's Nikkei closed down 0.6% to 10,797 while Hong Kong's Hang Seng ended the session up 0.7% at 11,832.

A report that Japan's economy had entered its third recession in the last 10 years sent the yen lower against the dollar and the euro. The country's economy shrank at a 0.5% clip in the third quarter following a revised 1.2% contraction in the second.

Meanwhile, reports indicated that the Taliban has surrendered Kandahar, its last main stronghold in Afghanistan, and the group's fighters have handed over their weapons to the Northern Alliance. But terrorist mastermind Osama bin Laden and Taliban leader Mullah Mohammad Omar have managed to evade allied forces.