Stocks had a shaky start Friday as investors tried to wade through the jobs report to see what it means for the recovery.
The Dow Jones Industrial Average tried to push above 10,000 a couple times, but struggled to sustain gains above that level as investors worried the recent selloff may be the beginning of a correction. Banks and techs came on strong, while drug and retail stocks were weak.
Merck , Kraft and Chevron led the Dow decliners.
Travelers , Bank of America and JPMorgan were the topDow gainers.
The jobs report showed employers cut 20,000 jobsfrom nonfarm payrolls in January, while the unemployment rate fell to 9.7 percent.
Economists had actually been expecting payrolls to increase by 5,000 last month and for the unemployment rate to tick up to 10.1 percent.
In addition to the unexpected job loss for January, the prior five months through December were revised to show an additional 245,000 jobs were lost than previously thought, but economists said take it in stride.
"Overall, improving payroll trend continues but progress is slow," Ian Shepherdson, chief US economist at High Frequency Economics, wrote in a note to clients.
Construction, transportation and warehousing continued to report job losses, while temporary employment and retail actually added jobs.
The CBOE volatility index, the market's fear gauge, slipped back closer to 25, after spiking more than 20 percent in the prior session as a brutal selloff left the Dow down 4 percent for the year and triggered a fresh debate about whether or not the market is entering a correction.
"We're in a correction," Andrew Kanaly, chairman of Kanaly Trust, said on CNBC this morning, citing concerns about Greece and Spain, and worries that sovereign debt problems will spread, and even circle back to the US.
"It's not going to be too long before — maybe this fall — we start learning maybe our [US] strucutural deficits are 'significantly bigger' than we've been told they are."
John Merrill, founder of Tanglewood Wealth Management, said he's a little worried but remains bullish.
"I think this is more of a correction. It may have a little bit more to go," but added, "I think this is a bull market. It's very well supported," citing the IMF raising its global growth projection to 3.9 percent and rising corporate earnings.
There was some M&A activity this morning: Air Products and Chemicals has launched a hostile bid to buy its chief rival Airgas for about $60 per share, a 38 percent premium to Thursday's closing price. The deal is valued at about $7 billion including assumed debt.
Airgas shares surged more than 40 percent.
Two weeks after a massive recall, Toyota's president apologized to customers for safety issues with its vehicles.
"The recalls are affecting several models in several regions and have cuased anxiety among customers who are wondering if their cars are OK. For that, we are sorry," said Toyota President Akio Toyoda.
Plus, more bad news for the automaker: Japan's Nikkei business daily reported that the company is planning to recall 270,000 Prius models in the U.S. and Japan to fix a braking problem.
Still to come: December figures for consumer credit are due out at 3pm ET. Economists are looking for outstanding consumer credit to drop by $8 billion for the month following a $17.5 billion drop in November.
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