NEW YORK (CNNMoney.com) -- Stocks retreated Friday, following a mixed jobs report for September, marking an end to the streak of record highs on Dow Jones industrial average.

The Dow (down 32.97 to 11,833.72, Charts) lost 0.1 percent. On Thursday, the blue-chip leader managed a third straight record close, ending at 11,866.69 and briefly touching a trading high of 11,870.06.

Special Reportfull coverage Fewer jobs for unemployed workers Unemployment claims rise Half of workers unhappy in their jobs Unemployment claims stuck above 400,000 State, local layoffs to hit record levels

The S&P 500 (down 5.03 to 1,348.19, Charts) index fell 0.3 percent, after ending the previous session at its highest point since February 2001.

The tech-fueled Nasdaq composite (down 8.23 to 2,298.11, Charts) was also down around 0.3 percent.

On Tuesday, the Dow first knocked out its old record from January 2000, and the blue-chip index has built on it since then. The other major gauges have participated in the run-up as well.

The nearly four-year-old bull market stumbled in May and June, but found some new strength later in the summer as oil and gas prices started falling and the Federal Reserve opted to pause its more than two-year-old interest-rate-hiking campaign.

Investors seem to believe that the fall in oil prices will bring down inflation pressures and that the economy is set to slow but not hit a recession. They also seem to be betting that the Fed is likely to start cutting rates as early as the first quarter of next year.

However, anything that threatens these bets has the potential to unsettle stock investors. That seemed to be the case with the morning's mixed jobs report, which gave investors a good excuse to take profits off the recent rally.

Employers added 51,000 jobs to their payrolls in September, according to a report released Friday morning. That was short of expectations for employers to add 120,000. However, the previous month was revised higher, tempering the blow. In addition, average hourly earnings, the report's inflation component, rose a less than expected 0.2 percent in the month.

The unemployment rate, generated by a separate survey, dropped to 4.6 percent in September from 4.7 percent in the previous month, surprising economists who thought it would hold steady.

Beyond the jarring 51,000 payrolls number, the underlying report paints a fairly bullish take on employment, said Joshua Shapiro, chief economist at Maria Fiorini Ramirez Inc.

That may have been a bit disappointing to stock and bond investors, in that if employment is in fact holding up well, the Fed will be less likely to start cutting rates early next year.

"I think the bond market today is showing a lessened probability of early Fed easing," he added.

Treasury prices slipped following the report, with investors also taking profits off the recently buoyant bond market. The decline boosted the yield on the 10-year note to 4.69 percent from 4.60 percent late Thursday. Bond prices and yields move in opposite directions.

The Treasury market closed early for the Columbus Day holiday and will be closed Monday.

U.S. light crude oil for November delivery fell 27 cents to $59.76 a barrel on the New York Mercantile Exchange.

COMEX gold for December delivery added $1.30 to $576.80 per ounce after sliding in the morning.

Here's what was moving near the close:

General Motors (down $2.25 to $30.88, Charts) was the Dow's biggest decliner, falling 7 percent after a regulatory filing showed that a supporter of Kirk Kerkorian's Tracinda Group has quit the automaker's board amid dissatisfaction with management and GM's decision to end talks with Nissan and Renault.

Influential investor Kerkorian has also indicated in the filing that he does not intend to add to his holdings of GM shares. (Full story.)

Chipmaker Micron Technology (down $2.41 to $15.13, Charts) slumped 13 percent in active trade after it reported quarterly earnings and revenue late Thursday that rose from a year earlier but missed analysts' estimates.

A number of chip stocks slipped in response, with the Philadelphia Semiconductor (down 4.09 to 451.32, Charts) index down about 1 percent.

Grocery chains Walgreen (down $0.97 to $42.42, Charts), Rite Aid (down $0.26 to $4.61, Charts) and CVS (down $1.80 to $29.13, Charts) all sank one day after Wal-Mart Stores (down $0.11 to $48.30, Charts) said it will roll out its discount generic drug program four months ahead of schedule.

On the upside, shares of Chattem (up $9.81 to $44.24, Charts), a consumer products maker, surged 27 percent in unusually active Nasdaq trade. The company said it is buying five brands from Johnson & Johnson (Charts) and Pfizer (Charts) for about $410 million. The larger companies are selling these brands because of regulatory requirements related to J&J's purchase of Pfizer's consumer health care business.

Market breadth was negative. On the New York Stock Exchange, losers beat winners nearly two to one on volume of nearly 1.5 billion shares. On the Nasdaq, decliners edged out advancers on volume of 1.6 billion shares.

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