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NEW YORK (CNN/Money) -
Stocks fell Friday -- at the end of an otherwise upbeat week for equities -- as investors welcomed falling oil prices but remained cautious amid worries about the fallout from Hurricane Katrina.
All financial markets are closed Monday for the Labor Day holiday.
The Dow Jones industrial average (down 12.26 to 10,447.37, Charts) lost 0.1 percent. The Nasdaq composite (down 6.71 to 2,141.07, Charts) and the Standard & Poor's 500 (down 3.57 to 1,218.02, Charts) index both fell around 0.3 percent.
For the week, all three major gauges closed higher.
U.S. light, sweet crude oil for October delivery sank $1.90 to settle at $67.57 a barrel on the New York Mercantile Exchange. The NYMEX closed early ahead of Monday's Labor Day holiday.
Oil slumped after the International Energy Agency said the governments of 26 countries had agreed to release approximately two million barrels of oil per day over the next month from strategic fuel reserves to help the United States amid the fallout from hurricane Katrina.
Additionally, the Bush Administration will release around 30 million barrels of oil from the nation's stockpile, according to U.S. Energy Secretary Samuel Bodman.
Separately, some fuel pipelines along the Gulf Coast restarted after having shut down in the wake of Hurricane Katrina.
But gasoline prices remained higher at service stations across the country, amid distribution problems and reports of price gauging.
The August jobs report, released Friday morning, showed that employment continues to pick up, but wage pressures remain minimal.
Stocks were mixed, regardless of the session's positives, amid continuing uncertainty about what the Federal Reserve will do in terms of interest rates over the next few months, the outlook for inflation, and the hurricane's impact on the economy, said Michael Darda, chief economist at MKM Partners.
On the upside, "stocks have been meandering since the hurricane hit," he added. "The market is basically taking it in stride, which says that there's a tremendous amount of negativity priced in to stocks already.
What's moving?
Oil service stocks slumped along with the commodity, sending the Philadelphia Oil Services Sector (Charts) index down 2 percent.
Losers included Exxon Mobil (down $1.00 to $60.68, Research), ConocoPhillips (down $2.23 to $66.77, Research) and Valero Energy (down $1.07 to $108.43, Research).
Homebuilders were hit again, falling after a broad bounce earlier in the week. The Dow Jones Home Construction (unchanged at $979.54, Research) index lost 1.1 percent.
Northwest Airlines (down $0.34 to $3.63, Research) tumbled 8.6 percent in active Nasdaq trading after the nation's No. 4 airline warned late Thursday that higher fuel prices would cause it to post a loss in the third quarter.
The carrier also said it was in danger of having to file for bankruptcy unless Congress could help it as it seeks to make up a pension shortfall.
Boeing (down $1.65 to $64.34, Research) lost 2.5 percent after its machinist union went on strike Friday amid contract disputes with the aerospace and defense contractor.
On the upside, Albertson's (up $2.32 to $23.05, Research), the No. 2 supermarket chain, jumped 11 percent after saying that it may put itself up for sales as it tries to fight off weaker sales.
Also on the upside, Caterpillar (up $1.31 to $58.25, Research) shares continued to rise along with other construction and machinery-related issues amid bets that sales will benefit from rebuilding efforts after the hurricane.
Market breadth was negative. On the New York Stock Exchange, losers edged winners by eight to seven on volume of 1.26 billion shares. On the Nasdaq, decliners topped advancers by more than four to three on volume of 1.15 billion shares.
Jobs report mostly solid
Employers added approximately 169,000 jobs to their payrolls in August, short of economists' forecasts for 190,000 jobs. But the July payrolls number was also revised higher to 242,000 from an initial read of 207,000.
The unemployment report, generated by a separate survey, fell to 4.9 percent from 5.0 percent in July, versus forecasts for an unchanged reading. Average hourly wages rose a scant 0.1 percent, short of forecasts for a 0.2 percent increase.
"I thought the jobs report was more robust than the headline number would suggest, with the June and July upward revisions to payrolls countering the August miss," MKM Partners' Darda added.
Treasury prices fell, raising the yield on the 10-year note to 4.04 percent from 4.02 percent late Thursday. Treasury prices and yields move in opposite directions.
In currency trading, the dollar fell versus the euro and the yen.
COMEX gold rose $2 to settle at $448.50 an ounce, in an abbreviated session ahead of Labor Day.
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