NEW YORK (CNN/Money) -
Stocks managed modest gains at the end of a brutal week on Wall Street, as a less-awful-than-feared September jobs loss report cooled some worries about the health of the economy.
The Nasdaq composite (up 6.27 to 2,090.35, Charts) added 0.3 percent and the Standard & Poor's 500 (up 4.41 to 1,195.90, Charts) index gained around 0.4 percent. The Dow Jones industrial average (up 5.21 to 10,292.31, Charts) ended little changed.
Treasury prices edged higher, lowering the corresponding yields. The dollar climbed versus other major currencies.
All three major indexes had gained in the morning, following the payrolls report, but lost some momentum in the afternoon, particularly ahead of what, for some, will be a long weekend.
Monday is Columbus Day. While the stock market won't take a break for the holiday, some Wall Street professionals will likely make it a three-day holiday. Meanwhile, the treasury bond market and the banks will be closed.
Stocks have slumped this week amid growing worries about a pickup in inflation and more interest-rate hikes from the Federal Reserve, following a parade of hawkish speeches from Fed officials.
The Dow and S&P 500 fell for four out of five days and the Nasdaq fell for three out of five days, leaving the major gauges at the lowest level. For the week, the Dow lost 2.6 percent, the S&P fell 2.7 percent and the Nasdaq fell 2.8 percent.
"The declines have put stocks at a critical level that they need to recover from in the near term," said Todd Salamone, director of trading at Schaeffer's Investment Research.
"We're at key support levels from a technical perspective," he added. "If we don't bounce back soon, we could see a lot more selling."
Job loss not as bad as feared
The economy lost jobs in September for the first time in over two years, the Labor Department said Friday morning. About 35,000 jobs were lost from payrolls in September, reflecting the impact of Hurricane Katrina.
But a survey of economists by Briefing.com showed the average expected loss was 150,000 jobs. Economists surveyed by Reuters called for a loss of 129,000 jobs, on average. Due to uncertainty about the impact of the storm, individual estimates ranged widely.
The government also said the economy added more jobs in August than had previously been reported.
The unemployment rate, generated by a separate survey, rose to 5.1 percent in the month from 4.9 percent in August, in line with forecasts.
"The bottom line is that, excluding the hurricane, to the best that we can tell, job growth continues to be good, as was made clear by the upward revisions to the previous two months," said Stephen Stanley, chief economist at RBS Greenwich Capital.
Stanley said that the market reaction Friday was perhaps more muted than it might have been due to concerns about disruptions to New York's subway system after officials reported a potential terrorist threat.
Gainers Friday included some of the sectors hit hardest in this week's sell-off, including homebuilders, oil stocks and technology.
KB Home (up $0.65 to $66.95, Research) and Toll Brothers (up $0.65 to $39.91, Research) were among the stocks lifting the Dow Jones Home Construction (up $8.14 to $889.17, Research) index.
Exxon Mobil (up $1.03 to $59.60, Research) led the list of oil stocks gaining, sending the Amex Oil (up 20.80 to 996.48, Charts) index up 2 percent.
Other Dow gainers included IBM (up $0.80 to $80.50, Research), Caterpillar (up $1.43 to $56.62, Research) and General Electric (Research).
Tech gains were mostly concentrated in Internet and chips.
Blockbuster (up $0.97 to $5.42, Research) jumped nearly 22 percent as worries about it defaulting on its loans eased up a bit. The video rental chain said late Thursday that its third-quarter earnings will show it kept up with debt during that period.
On the downside, Delphi (down $1.08 to $1.12, Research) plunged over 49 percent and topped the New York Stock Exchange's most-actives list on reports that the auto parts maker could go bankrupt as early as Friday.
Standard & Poor's downgraded the auto parts supplier's debt deeper into junk status.
And Research in Motion (Research) lost over 3.6 percent after an appeals court refused to reconsider a ruling that the company infringed on patent rights with its popular BlackBerry messaging device.
Market breadth was positive. On the New York Stock Exchange, winners topped losers three to two on volume of 1.60 billion shares. On the Nasdaq, advancers topped decliners four to three on volume of 1.47 billion shares.
In addition to the jobs report, a separate report showed that wholesale inventories rose more than expected in August.
U.S. light crude for November delivery rose 48 cents to settle at $61.84 a barrel on the New York Mercantile Exchange.
Treasury prices gained in an abbreviated session ahead of the Columbus Day holiday. The gains pushed the yield on the 10-year note down to 4.37 percent from 4.38 percent late Thursday. Treasury prices and yields move in opposite directions.
The dollar rose versus the euro and yen.
COMEX gold rose $2.70 to settle at $477.70 an ounce.