Skip to main content

Updated from 4:06 p.m. EDT

A discouraging report on employment ended a weeklong winning streak for the major stock averages Friday, with the


finishing almost 1% lower after flirting with a triple-digit decline throughout the afternoon.

The Dow Jones Industrial Average, which had risen for the past five sessions, dropped 84.56 points, or 0.9%, to 9503.34. The


, which has climbed for the last seven sessions, fell 10.85 points, or 0.6%, to 1858.12, and the

S&P 500

dropped 6.60 points, or 0.6%, to 1021.37.

While investors couldn't resist the urge to take profits after the healthy run, the market indices still ended the week with solid gains. For the week, the Dow gained 87.52 points, or 1%, while the Nasdaq rose 47.67 points, or 2.6%, and the S&P 500 was up 13.36 points, or 1.3%.

The negative tone was set early, after the Labor Department said 93,000 jobs were lost in August, despite a dip in the unemployment rate to 6.1% from 6.2%. Economists had predicted a net addition of jobs in the month and for the unemployment rate to hold steady.

While most economic data has been positive in the past few months, employment has lagged, pressuring shares on Friday. "It's understandable that people are still worried about the lack of job growth," said Donald Straszheim, president of Straszheim Global Advisors. "The market has come a long way in a hurry. The prices are out riding the earnings in a hurry, and that's never any good."

But for now, it's too early to speculate if the selloff will spread into a wider, multi-day pull back, said Jim Awad, president of Awad Asset Management, who suggested that investors could be getting skittish after six months of upward movement ahead of the upcoming two-year anniversary of Sept. 11. "There's been so much momentum for so long that it would take more than one down day to prove it was more than transitory," Awad said.

Bonds shot up on the jobs report, with the 10-year Treasury note adding 1 2/32 in price to yield 4.37%.

In corporate news, drug giant

Eli Lilly

TheStreet Recommends

(LLY) - Get Eli Lilly and Company Report

said it expects to earn $2.55 to $2.60 a share in 2003, about the same as last year and toward the high end of existing analyst estimates. Shares fell 9 cents, or 0.2%, to $60.95.

Also rising was



, which Thursday night raised revenue guidance for this year and both revenue and earnings guidance for next. The shares were up 5 cents, or 0.3%, to $19.30.

Tech was supported by


(INTC) - Get Intel Corporation Report

midquarter update, in which it raised the low end of its third-quarter revenue estimate and said it is experiencing strong demand for its microprocessors. The shares gained 11 cents, or 0.4%, at $28.71.


(DELL) - Get Dell Technologies Inc Class C Report

target price and estimates were raised by a Bear Stearns analyst following Intel's news. The analyst said Dell has increased its sales faster than Intel from the second quarter to the third quarter in eight of the past 10 years. Nevertheless, shares were down 26 cents, or 0.8%, to $34.09.

Also riding Intel's wave were

Advanced Micro Devices

(AMD) - Get Advanced Micro Devices, Inc. Report

, up 41 cents, or 3.5%, to $12.11, and

Texas Instruments

(TXN) - Get Texas Instruments Incorporated Report

, which was up $1, or 4.1%, to $25.16.

National Semiconductor


rose $1.35, or 4.2%, to $33.34. On Thursday, the company reported first-quarter earnings that rose sharply and beat analysts' estimates by 3 cents. The company also forecast a second-quarter revenue increase of 4% to 7%.


BEA Systems


dropped on news that it was downgraded by Smith Barney to in-line from outperform based on valuation. Shares fell 42 cents, or 2.8%, at $14.35.

Circuit City

(CC) - Get Chemours Co. Report

reported that second-quarter revenue fell 3% to $2.16 billion and comparable-store sales fell 5%. Shares rose 35 cents, or 3.4%, to $10.58.

West Marine


fell 81 cents, or 3.9%, to $20.19 after the company lowered its third-quarter and full-year 2003 earnings estimates.

Shares of

Finish Line


were down $1.85, or 6.8%, to $25.30 after the company was downgraded by Merrill Lynch to neutral from buy based on valuation.

Overseas markets were mostly higher, with London's FTSE 100 closing up 0.2% to 4257 and Germany's Xetra DAX rising slightly to 3573. In Asia, Japan's Nikkei was roughly unchanged at 10,651, while Hong Kong's Hang Seng rose 0.3% to 11,171.

The Nasdaq Composite ended Thursday at 1869, leaving it at its highest level since April 2002, while the Dow closed at 9588, putting it up about 170 points over the previous three sessions and near a 15-month high.