Updated from 4:10 p.m. EDTStocks managed to break a string of losses that persisted since the start of the week, but Friday's minor gains didn't come close to offsetting the damage that had already been done in recent sessions. The Dow Jones Industrial Average added 5.21 points, or 0.05%, to 10,292.31. The S&P 500 gained 4.41 points, or 0.37%, to 1195.90, while the Nasdaq rose 6.27 points, or 0.3%, to 2090.35. "Inflation spooked the market this week, as the perception of how aggressive the Fed is going to be is a concern," said Barry Hyman, equity market strategist with Ehrenkrantz King Nussbaum. "We also saw an extreme correction in the energy sector. Now we have to rely on better-than-expected earnings, which is a tough call." The major averages closed below their session highs, but considering the struggles equities have had this week, long investors were probably glad to see any kind of positive number. The Dow and the S&P had fallen for four straight days, and the Nasdaq dropped for three in a row as inflation worries led to selling pressure. For the week, the Dow fell 2.61%, the S&P 500 lost 2.67%, and the Nasdaq finished down 2.85%. About 1.61 billion shares traded on the New York Stock Exchange, with advancers beating decliners by a 10-to-7 margin. Trading volume on the Nasdaq was 1.46 billion shares, with advancers outpacing decliners 3 to 2. According to the Labor Department, 35,000 jobs came off payrolls in September, and the unemployment rate rose to 5.1% from 4.9%. On average, economists had been expecting about 150,000 jobs to be lost. "This data is not as weak as expected, considering the upward revision to prior months," said John Canavan, a market analyst with Stone & McCarthy Research Associates. "The initial reaction is down for Treasuries. We're still not sure how it'll work out or if there will be any follow-through. It's generated a technical break, though. We'll have to watch how it shakes out." Average hourly earnings rose 0.2% last month, the employment report indicated. Hurricane Katrina's effects were factored into the report, but Rita hit the Gulf Coast too late to be included. "This might just mean that the Katrina effect will be spread across more than one month," said Ian Shepherdson, chief economist with High Frequency Economics. "The rise in jobless claims since the storm does suggest a bigger loss of jobs than indicated here, but we can't rule out the idea of a marked strengthening in payrolls ex-Katrina." In other markets, the benchmark 10-year Treasury added 9/32 in price to drop the yield to 4.35%. The dollar rose against the euro and the yen after the jobs data were released.
"The bond market is a little bit nervous," said Ken Tower, chief market strategist with CyberTrader. "I don't see that these numbers will convince the Fed to stop raising rates gradually. I think they'll stick to it. The risk for the market, though, is that the Fed will overshoot. We're worried about slowing-down effects hitting the economy." Energy prices were mixed. November crude oil futures finished up 48 cents to $61.84 a barrel in Nymex trading, falling 7.4% since last Thursday. Unleaded gasoline futures lost a penny to $1.83 a gallon, and natural gas reversed course and fell 15 cents to $13.22 per mmBtu. Citing a confidential update to United Auto Workers members, The Detroit News reports that troubled auto-parts maker Delphi ( DPH) could file under Chapter 11 of federal bankruptcy law as soon as today. Delphi tumbled $1.08, or 49.1%, to close at $1.12. CSG Systems ( CSGS) announced that it has agreed to sell its global software division to Comverse Technology ( CMVT) for about $251 million in an all-cash deal. Comverse said the acquisition should slightly lift fiscal 2006 pro forma net income. The deal is expected to close by the end of January. The Wall Street Journal reported that Time Warner ( TWX) and Microsoft ( MSFT) have started talking again about an alliance of their Internet units. The companies had begun discussions earlier this year, but the talks stalled. Now the companies are looking for ways to combine AOL's content with Microsoft's search technology, the report said. Staples ( SPLS) announced a $1.5 billion stock repurchase program, which is expected to be effective in November. The company also reiterated its fiscal third-quarter outlook and says it's expecting earnings growth 15% to 20% for 2006. Staples gained 12 cents, or 0.6%, to $21.47. VeriSign ( VRSN) said Friday that it has acquired Weblogs.com and its "ping server" from Scripting News for $2.3 million in cash. Shares were lower by 15 cents, or 0.8%, to finish at $19.93.
National Fuel Gas ( NFG) lifted its fourth-quarter earnings forecast to 56 cents to 64 cents a share from 50 cents to 56 cents a share, citing higher commodity prices. The energy company also boosted its fiscal 2006 earnings estimate to $2.30 to $2.50 a share from $1.95 to $2.10 a share. The stock added 77 cents, or 2.4%, to $32.93. Steven Madden ( SHOO) said that third-quarter earnings will beat expectations after stronger-than-expected sales in its wholesale and retail divisions. The shoemaker expects earnings of 36 cents to 39 cents a share, ahead of the Thomson First Call consensus of 27 cents. The company also expects revenue of $99 million to $100 million. Shares were up $2.72, or 11.9%, to close at $25.52. Late Thursday, Accenture ( ACN) posted fourth-quarter net earnings of $356.6 million, or 38 cents a share, up from $298.1 million, or 30 cents a share, a year ago. Accenture said net revenue rose to $3.92 billion from $3.42 billion last year. Analysts expected EPS of 36 cents on revenue of $3.85 billion, according to Thomson First Call. Accenture also reaffirmed first-quarter and 2006 full-year earnings. Accenture rose $1.42, or 5.6%, to $26.67. In ratings news, Piper Jaffray upgraded PetsMart ( PETM) to outperform from market perform, saying it believes the current valuation of shares doesn't reflect the potential for solid sales and an earnings recovery in 2006. PetsMart climbed 34 cents, or 1.5%, to $22.59. Overseas stocks were mostly lower. London's FTSE 100 lost 0.2% to 5362, and Germany's Xetra DAX fell 0.2% to 5008. Overnight, Hong Kong's Hang Seng edged up 0.06% to 14,848, while Tokyo's Nikkei fell 1% to 13,228.