Despite a late-day rally on Friday, stocks suffered their worst weekly losses since November after a government report showed unemployment in February reaching the worst levels since 1983.
The Dow Jones industrials, down as much as 124 points at 3:20 p.m. ET, finished the day with a 33-point gain to 6,627. The Standard & Poor's 500 Index closed up 1 point to 683.
The Nasdaq Composite Index finished down 6 points to 1,294, mostly because of weakness in such key stocks as Apple (AAPL, news, msgs), Google (GOOG, news, msgs), Research In Motion (RIMM, news, msgs) and Amazon.com (AMZN, news, msgs).
Despite the rally, which appeared to be short-covering by speculators who had sold stocks short during the week, the Dow finished down 6.2% for the week, its worst loss since the week of Oct. 6, when it fell 18%. The S&P 500's 7% loss and the Nasdaq's 6.1% loss were their worst since the week of Nov. 17.
The selling extended the losses for the Dow and the broader S&P 500 to levels not seen since 1996. The Nasdaq finished at six-year lows.
The Dow and S&P 500 have now fallen more than 20% since Jan. 16, the day before President Barack Obama was sworn into office; the Nasdaq is off 15.4% The major averages are down more than 53% from their 2007 highs.
Stocks opened higher on Friday but quickly faded after the miserable February jobs report showed the economy is slumping badly since the recession began in December 2007.
The U.S. unemployment rate hit 8.1%, up from 7.6% in January and a 25-year high. At the same time, the Labor Department said employers shed 651,000 jobs in February, the 14th straight month of job declines.
Job losses since December 2007 now total an estimated 4.4 million.
Adding to the selling pressure was continued uneasiness with the Obama administration's plans to stabilize the financial system and growing opposition to its tax plans.
"It's the Obama bear market," Dan Veru, money manager at Palisade Capital Management, told Bloomberg. "We don't know what the rules are in so many different areas the government is touching."
BusinessWeek reported this week that a broad array of business is gearing up to fight the president's budget plan.
Crude oil was up $1.91, or 4.4%, to $45.52 a barrel Friday.
Financial stocks were once again the market's weak link, with the Select Sector SPDR-Financial (XLF, news, msgs) exchange-traded fund falling 1% to $6.18. The ETF mirrors the financial stocks in the S&P 500. JPMorgan Chase (JPM, news, msgs) down as much as 8% closed down 4% to $15.93. Goldman Sachs (GS, news, msgs) was off 7.4% to $75.65.
Tech stocks were lower, in part because of weakness in Apple, which was off 4% to $85.30. JPMorgan Securities analyst Mark Moskowitz cut his fiscal second-quarter and full-year estimates for Apple. He also cut his estimates for shipments of Macintosh computers and iPhones in the second quarter because industry contacts suggest that sales have been below expectations.
Apple was off 6% for the week.
American Express avoids a dubious distinction
Until the rally set in, American Express (AXP, news, msgs) looked like it might become the sixth of the 30 Dow stocks to finish below $10 a share. However, the credit card company's shares rallied off a bottom of $9.71 to finish at $10.26, down 0.7% on the day.The five Dow stocks selling below $10 are: Citigroup (C, news, msgs), which closed Friday at $1.03; General Motors (GM, news, msgs), $1.45; Bank of America (BAC, news, msgs), $3.14; Alcoa (AA, news, msgs), $5.22; and General Electric (GE, news, msgs), $7.06.
GE's 6% gain, however, was the best among the 30 Dow stocks on Friday
A total of 16 Dow stocks were higher. Chevron (CVX, news, msgs), up 3.2% to $58.27, and Exxon Mobil (XOM, news, msgs), up 2.9% to $64.03, each contributed 14 points to the Dow
Meanwhile, 214 S&P 500 stocks were higher, led by Rohm & Haas (ROH, news, msgs), up 18% to $63.80 on reports it is in talks with Dow Chemical (DOW, news, msgs) to try to settle litigation related to Dow's refusal to close its $15 billion acquisition of Rohm & Haas. Dow Chemical was third in the S&P 500, up 9.9% to $7.11.
Meanwhile, 43 stocks in the Nasdaq-100 Index ($NDX.X) were higher, led by construction company Foster Wheeler (FWLT, news, msgs), up 15.8% to $15.15.
The index fell 10 points, or 0.9% to 1,064.70. In addition to Apple, laggards included Qualcomm (QCOM, news, msgs), down 2.9% to $33.63, Cisco Systems (CSCO, news, msgs), down 2.5% to $14.18, and Amazon.com (AMZN, news, msgs), down 4.8% to $61.69.
| Close for week | Wk. ago close | % chg. | 2009 YTD chg. | |
|---|---|---|---|---|
| Dow Jones Industrial Avg. | 6,626.94 | 7,062.93 | -6.17% | -24.49% |
| S&P 500 Index | 683.38 | 735.09 | -7.03% | -24.34% |
| Nasdaq Composite Index | 1,293.85 | 1,377.84 | -6.10% | -17.96% |
| Russell 2000 Index | 351.05 | 389.02 | -9.76% | -29.71% |
| Crude oil per barrel | $45.52 | $44.76 | 1.70% | 2.06% |
| 10-yr. Treasury yield | 2.83% | 3.04% | -0.21% | 26.02% |
| Gold per troy ounce | $942.70 | $942.50 | 0.02% | 6.60% |
Inside the jobs report
Today's unemployment report was in line with economists' expectations of 650,000 jobs lost and an unemployment rate of 7.9%.But the report showed a more worrisome statistic: 12.5 million people are now unemployed, the most since records began in 1940.
The only two industries that saw gains last month were education and health services. Service industries lost 375,000 jobs, financial companies lost 44,000 jobs and the retail sector shed 39,500 jobs in February.
- Talk back: Are you worried about your job?
There were also big upward revisions to the December and January unemployment figures. January's job losses were revised up to 655,000 from an initial 598,000, and December's were revised to a loss of 681,000 jobs from 577,000. December's decline was the biggest since October 1949.
"The best interpretation of this data is this: These numbers that we're seeing now (are) a reflection of September and October and November, and the panic that ensued in that period," Mark Zandi, chief economist of Moody's Economy.com, told CNBC. "And the policy response that we're seeing . . . will all begin to engage and by the summertime, these job losses will begin to abate."
Wells Fargo slashes dividend
Wells Fargo (WFC, news, msgs) said Friday that it is cutting its quarterly dividend by 85% to a nickel per share, and Wall Street cheered, sending the stock up 6% to $8.61. The dividend cut will save the banking giant $5 billion a year.Stock Charts (Year)
Wells Fargo
The company said that its merger with Wachovia is proceeding as planned.
Wells Fargo also said that it has "strong operating results" for the first two months of 2009. Bank of America (BAC, news, msgs) Chief Executive Officer Ken Lewis recently made similar comments about his company's quarter.
Financials have been hammered in recent days, with Citigroup (C, news, msgs) falling below $1 per share during the course of trading on Thursday before closing the session at $1.02 a share. This afternoon, Citi shares were up a penny to $1.03.
"If you had told me in the summer of 2007 that (Citi) would dip below $1, I would have said 'You're crazy,'" Joseph Saluzzi, co-founder of Themis Trading, told MarketWatch.com. "They have so many liabilities, so much bad stuff, they wouldn't even be trading if they weren't being supported by the government."
| Fri. | Thur. | Chg. | Month chg. | YTD chg. | |
|---|---|---|---|---|---|
| Crude oil (NYMEX) (per barrel) | $45.52 | $43.61 | $1.91 | 1.70% | 2.06% |
| Heating oil (per gallon) | $1.2294 | $1.1598 | $0.0696 | -2.88% | -12.54% |
| Natural gas (per million BTU) | $3.9450 | $4.0880 | -$0.1430 | -6.03% | -29.83% |
| Unleaded gasoline (per gallon) | $1.3220 | $1.3127 | $0.0093 | 3.22% | 31.12% |
H&R Block beats the Street
Tax Day is coming, and that means H&R Block (HRB, news, msgs) is getting busy.The tax preparation company Friday reported fiscal-third-quarter earnings that beat Wall Street's expectations. H&R Block earned $47.4 million, or 14 cents per share, up from a loss of $47.4 million, or 15 cents per share, in the same period a year ago. Profit from continuing operations was 20 cents, topping analysts' expectations for 9 cents per share.
Revenue rose 11% to $993.4 million, thanks to higher fees charged for tax returns H&R Block prepared.
The stock was up 7.9% to $18.68 on the news.
Coca-Cola invests in China
Coca-Cola was the second-best Dow performer Friday after announcing that it would invest $2 billion in plants and distribution infrastructure in China.Shares were up 3.3% to $39.10.
Coca-Cola is already committed to a $2.4 billion takeover of the China Huiyan Juice Group (CYUNF, news, msgs). If the takeover is completed, it would be the largest such move by a company outside China.
Growth in China slowed last year, but Chinese leaders have said recently that it is picking up again and will reach 8% for 2009.
More from MSN Money
Mortgage foreclosures rise
Nearly 12% of U.S. residents with a mortgage, or 5.4 million homeowners, were at least one month late with mortgage payment or already in foreclosure proceedings, the Mortgage Bankers Association said on Thursday, up from 10% at the end of the third quarter.The U.S. House passed a bill Thursday that could provide some relief to struggling homeowners. The proposed law would allow so-called "cram-downs" -- reduced mortgage payments forced upon lenders by bankruptcy judges -- designed to help owners keep their homes. The banking industry hotly opposes this bill, and it will face heavy debate in the Senate.
Meanwhile, a Senate vote on President Obama's $410 billion spending plan was postponed Thursday night because it did not have enough support to be passed.
Treasury candidates withdraw
Obama's Treasury secretary, Tim Geithner, has had a rough start, and things aren't getting any easier.Geithner, whose nomination faced a storm of criticism after it was discovered that he didn't pay certain taxes, is on the other side of the fence now. His choice for deputy secretary, Annette Nazareth, has removed herself from the running, The Wall Street Journal reported late Thursday.
Caroline Atkinson, who was being considered to oversee international affairs, also withdrew from consideration, the paper reported. The newspaper said the pair withdrew in part because of the long vetting process.
The Treasury Department currently has only one nominated official -- Geithner.
Geithner "shouldn't be sitting there alone," former Federal Reserve Chairman Paul Volcker, now an economic adviser to Obama, said recently, calling the lack of staff "shameful."
Andrew Rosenbaum contributed to this report.
| Fri. | Thur. | Chg. | Month chg. | YTD chg. | |
|---|---|---|---|---|---|
| Treasurys | |||||
| 13-week Treasury bill | 0.185% | 0.200% | -0.015 | -26.00% | 60.87% |
| 5-year Treasury note yield | 1.839% | 1.807% | 0.032 | -8.96% | 18.57% |
| 10-year Treasury note yield | 2.828% | 2.819% | 0.009 | -7.00% | 26.02% |
| 30-year Treasury bond yield | 3.503% | 3.505% | -0.002 | -5.88% | 30.17% |
| Currencies | |||||
| U.S. Dollar Index | 88.680 | 89.200 | -0.520 | 0.60% | 7.95% |
| British pound in dollars | $1.4098 | $1.4116 | -0.0018 | -1.56% | -4.31% |
| Dollar in British pounds | £0.7093 | £0.7084 | 0.0009 | 1.59% | 4.51% |
| Euro in dollars | $1.2660 | $1.2544 | 0.0116 | -0.16% | -9.63% |
| Dollar in euros | € 0.7899 | € 0.7972 | -0.0073 | 0.16% | 10.66% |
| Dollar in yen | 98.18 | 98.02 | 0.16 | 0.58% | 8.31% |
| Canadian dollar in U.S. dollars | $0.777 | $0.776 | $0.0014 | -1.04% | -4.96% |
| U.S. dollar in Canadian dollars | $1.287 | $1.289 | -$0.0016 | 1.04% | 5.21% |
| Commodities | |||||
| Gold | $942.70 | $927.80 | $14.90 | 0.02% | 6.60% |
| Copper | $1.6890 | $1.6535 | $0.04 | 9.78% | 19.79% |
| Silver | $13.3330 | $13.1200 | $0.21 | 1.70% | 16.16% |
| Corn | $3.6150 | $3.5850 | $0.03 | 3.06% | -11.18% |
| Crude oil (NYMEX) (per barrel) | $45.52 | $43.61 | $1.91 | 1.70% | 2.06% |
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