msnbc.com news services
updated 12/6/2004 9:16:51 AM ET 2004-12-06T14:16:51

Stocks finished Friday with slim gains, closing a positive week for the market’s main indices, as investors greeted a fourth straight decline in oil prices, but worried about the health of the economy after a disappointing report on job creation.

Major Market Indices

Crude oil futures continued their decline, falling below the $43-per-barrel mark for the first time in two and a half months. A barrel of light crude settled at $42.54, down 71 cents, on the New York Mercantile Exchange, raising hopes that a continued slide in oil prices would lift an economy weighed down by high energy costs.

Oil’s performance helped investors look past a worrisome jobs report. The Labor Department said there were 112,000 new jobs in November, far less than the 200,000 Wall Street expected. Furthermore, October’s blockbuster gains of 330,000 were adjusted down to 307,000.

“Certainly, the jobs number was a surprise, but it’s still a positive,” said Jack Ablin, chief investment officer at Harris Private Bank in Chicago. “It still demonstrates that our economy is moving forward and creating jobs. And oil’s been a nice boost this week as well.”

David Briggs of Federated Investors told CNBC he was surprised that the jobs report didn’t weigh heavily on equities Friday.

“Equity markets are in a state of paralysis,” Briggs continued. “I think stocks are particularly uninteresting right now; we’ve had a heck of a nice run and we’re trading at decent price levels, but the economy is not growing as fast as it was and the question is what will push the market higher?”

The Dow Jones industrial average closed the day up 7.09 points, or 0.1 percent, while the broader Standard & Poor’s 500-stock index added 0.84 point, or 0.1 percent. The technology-rich Nasdaq composite index gained 4.39 points, or 0.2 percent.

Wall Street’s main stock indices managed post gains for the week thanks to a 13 percent drop in crude oil futures over the past three sessions. For the week, the Dow gained 0.7 percent, the S&P 500 rose 0.7 percent and the Nadsaq rose 2.2 percent.

Jobs and oil have been Wall Street’s biggest concerns in the second half of the year.

With gasoline and other energy prices unusually high, consumers have been less willing to spend, as seen by the sluggish start to the holiday shopping season. And without more spending, companies have been less willing to create new jobs, which would mean more consumers with disposable income.

However, investors remained bullish on stocks, with inflows of capital continuing to climb since the presidential election.

“It’s not really rational right now, because the fundamentals of the market don’t match up with the sentiment out there,” said Chris Johnson, manager of quantitative analysis at Schaeffer’s Investment Research in Cincinnati. “The cash that’s been poured into the market starting with the election has just been a buoying force. You’ve got an overbought market that’s going to remain overbought. “

Tech stocks gained traction after Intel Corp.’s bullish mid-quarter update, released late Thursday. The semiconductor giant and Dow component said its revenues would be substantially higher than Wall Street expected. Intel surged $1.20, or 5.28 percent, to $23.91.

Other chip makers rode Intel’s coattails and moved higher. Advanced Micro Devices Inc. was up 60 cents at $23.22, Texas Instruments Inc. gained 19 cents to $25.10 and National Semiconductor Corp. rose 15 cents to $16.20.

IBM Corp. added $1.32 to $97.08 after The New York Times reported that the Dow component is considering a sale of its personal computer business to Chinese computer maker Levono Group Ltd. IBM could get $1 billion to $2 billion in the transaction, according to the report.

A number of airlines reported an increase in business for November, as more people took to the skies during the Thanksgiving holiday. Among those reporting substantial increases in passenger miles, American Airlines parent AMR Corp. slipped 13 cents to $10.50, Alaska Air Group Inc. was unchanged at $32.90 and America West Holdings Corp. was down 2 cents at $6.35.

Overseas, Japan’s Nikkei stock average rose 0.93 percent. In Europe, Britain’s FTSE 100 closed down 0.07 percent, France’s CAC-40 fell 0.73 percent for the session, and Germany’s DAX index lost 0.18 percent.

MSNBC.com's Roland Jones and the Associated Press contributed to this report.

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