Wall Street opens higher on jobs report

NEW YORK (CNNMoney.com) -- Wall Street opens higher after stronger than expected November jobs report.

The Dow Jones Industrial Average, the tech-heavy Nasdaq and the S&P 500 all opened with modest gains.

Earlier in the morning, the Labor Department reported that the rate of unemployment held steady at 4.7 percent.

The numbers were roughly in line with expectations as economists were expecting employers to add 70,000 jobs last month, down from 166,000 in October. The unemployment rate was expected to rise to 4.8 percent from 4.7 percent in October.

Treasury prices retreated on the news as the yield on the benchmark 10-year note rose to 4.06 percent from 4 percent late Thursday.

Wall Street had been expecting a strong reading following a report from payroll processing firm ADP on Wednesday that showed a bigger surge in private-sector hiring than originally estimated.

The reading could further ease concerns about a recession in the U.S. and give stocks another boost, although those gains could be tempered because it would dash the hopes of some investors for the Federal Reserve to cut rates by a half-percentage point, also referred to as 50 basis points.

Stocks have rallied for the past two sessions on positive economic readings and bets that the Federal Reserve will cut rates at its policy meeting Tuesday.

Even with Friday's report Wachovia Chief Economist John Silvia said he could see the Fed cutting by a quarter percentage point due to continued problems in financial markets from this summer's meltdown in mortgage-backed securities.

In corporate news, smartphone maker Palm (Charts) saw shares plunge 21 percent in after-hours trading after it cut its second-quarter outlook and warned it will swing to a wider-than-expected loss due to a sales shortfall from the delay of a product launch.

Leading U.S. cell phone maker Motorola (Charts, Fortune 500) reaffirmed its earlier earnings guidance, but shares slipped narrowly in after-hours trading after initially gaining on the report.

Mortgage finance company Fannie Mae (Charts) on Thursday set a $25-a-share price for its previously announced plans for a $7 billion secondary stock offering next week, as it seeks to shore-up finances following losses on mortgage-backed securities. Shares of mortgage finance firm edged up 0.7 percent in after-hours trading.

Shares of insurer UnitedHealth Group (Charts, Fortune 500) slipped slightly in after-hours trading after former chairman and CEO William McGuire agreed to surrender more than $400 million to settle allegations related to a stock-options backdating scandal, the company and the Securities and Exchange Commission announced after the close Thursday.

The Wall Street Journal reported that General Motors (Charts, Fortune 500), Ford Motor (Charts, Fortune 500) and Chrysler all plan to cut back production in January of their full-size pickups, one of their most profitable products, as problems in the economy, especially home building, and new competition from Toyota Motor (Charts) cut into sales. The segment saw November sales down 8.3 percent when it released sales totals on Monday, worse than the 3.5 percent year-to-date decline.

Media conglomerate News Corp. (Charts, Fortune 500) announced that James Murdoch is the company's new chairman and CEO for Europe and Asia, suggesting that the 34-year old would most likely succeed his father, News Corp Chairman and CEO Rupert Murdoch, 76. James Murdoch, 34, had been CEO of British Sky Broadcasting Group, of which News Corp. owns 38 percent.

In global trade, Asia markets ended the session mixed while European stocks were mostly higher.

Oil prices, which crept back above $90 a barrel mark in trading Thursday, edged slightly lower in morning trading, with a barrel of light sweet crude falling 17 cents to $90.06