Stocks closed mixed on Friday, but higher for the week, following a volatile trading session as investors moved to the sidelines ahead of the weekend.
"Given the activity this week, everybody's tired and a lot of people on Wall Street were taking it easy after all the gyarations over the past week," Tom Schrader, head of U.S.-listed trading at Stifel Nicolaus, told CNBC.com. "The trend is still up, the markets got extremely oversold technically and I still think we're going to rally, but the gains might not be that sharp."
"I wasn't surprised to see the buyers jump in this morning, and it's not at all surprising to see short-term money taken off the table heading into the weekend," said Dan McMahon, head of listed trading at CIBC World Markets, in an interview with CNBC.com. "People are now either on vacation or gearing for it and they had enough of this tomfoolery in the last 10 sessions."
Stocks began the session sharply higher on Friday's monthly employment report as non-farm payrolls rose in February by 97,000, slightly below the 100,000 expected a consensus of economists.
The Dow Jones Industrial Average closed with a weekly rise of 162 points or 1.34%. The Dow is 510 points below the record high it reached on Feb. 20. The S&P 500 rose 15.68 points for the week, or 1.13%, and the Nasdaq gained 19.55 points or a gain of 0.83%.
Mark Jordahl, chief investment officer at First American Funds, told CNBC.com he expects a "trendless week" for markets in the coming week.
"We'll get a little more inflation data next week. We expect it to be tame and not consequential for the market," he said. "We're positive at this point but it's hard to know when the market will get its legs again. We were sort of picking stock by stock this week."
On Friday, breadth was slightly positive as advancing shares had a three-to-two edge on declining shares on the New York Stock Exchange. The energy and tech sectors were the only decliners among S&P sectors but overall price movements were limited.
Technology stocks closed slightly lower following earlier weakness as semiconductor shares staged a modest rally late in the session. "Tech had a pretty good rally off the recent lows so you just have some profit taking heading into the weekend," said CIBC's McMahon.
Internet portal Yahoo saw shares closed down 5.2% following a Wall Street Journal report the company's deal with AT&T may be restructured or lost completely.
Shares of tech heavyweights Microsoft and Hewlett-Packard also declined on general sector weakness, while National Semiconductor was a bright spot after the chip outfit reported quarterly earnings that topped analysts' expectations.
The U.S. Food and Drug Administration issued a new warning label Friday afternoon for three widely-used anemia drugs manufactured by Amgen. The FDA advised doctors to choose the lowest dose needed to avoid blood transfusions, the agency said. Two of the drugs, Aranesp and Epogen, are marketed by Amgen while Procrit is marketed under license by Johnson & Johnson. Amgen shares closed at a new 52-week low on the news.
The subprime lending industry is in focus once again as shares of New Century Financial fell on continued speculation it could file for bankruptcy.
Elsewhere, homebuilder Hovnanian Enterprises reported a wider-than-expected loss in the first quarter and cut full-year guidance. Farming equipment stocks such as Deere rose following a government forecast of stronger demand for corn from ethanol plants.
EADS fell after the aerospace company said operating earnings dropped by 86% to $526 million in 2006 due to losses at subsidiary and Boeing rival Airbus, which citeddelays in the A380.
Friday's employment report sparked mixed reactions on Wall Street. Jobs were still being created at a healthy pace -- assuaging fears of recession -- but decreased the likelihood of a interest rate cut from the Federal Reserve.
"We want to be buying the dip," Andrew Burkly, market strategist with Brown Brothers Harriman, told CNBC. "A lot of the momentum and sentiment indicators we looked at last week really got to extreme levels that tell us it's time to get interested in stocks again."
"You have margin debt at an all-time high," said Michael Metz, chief investment strategist at Oppenheimer. "You have a great speculative movement in almost every market in the world. You have money dirt cheap - people leveraging. It's going to result in some sort of accident."
New York light crude futures fell 2.6% on the New York Mercantile Exchange, closing with its first weekly decline in three weeks. Crude is down 1.6% year to date.
Treasury prices fell, sending yields higher, while the dollar once again gained on the yen.
Europe Ends Slightly Higher, Weaker Yen Lifts Japan
The Paris CAC-40, the Frankfurt DAX and London's FTSE-100 all closed with slight gains. The FTSE was burdened by the weak earnings outlook from EADS and shares of GlaxoSmithKline, which Goldman Sachs downgraded on Friday.
The Nikkei 225 Average finished higher as a weak yen lifted shares in Canon and other exporters.
South Korea's Kospi Index ended flat, pausing in a three-day advance, as investors locked in gains in outperformers such as Kookmin Bank. Hong Kong blue chips closed down in quiet trade, held steady by heavyweights China Mobile and HSBC.