Investors also have an eye on currencies, a day after the euro soared after European Central Bank President Jean-Claude Trichet hinted that an interest-rate hike could come as early April. Meanwhile, the dollar traded flat against a basket of currencies.
Financials were mostly in the red after Bank of America Merrill Lynch downgraded Citigroup and Goldman Sachs to "neutral" from "buy" and cut its price targets on the firms to $4.95 and $174 from $5.60 and $182, respectively, saying it expects first-quarter results for both banks to be tepid. Both stocks were trading lower.
Morgan Stanley shares also slipped after Bank of America Merrill Lynch cut its price target on the firm to $29 from $31.
Capital One Financial declined even after Barclays raised its price target on the bank to $60 from $55.
Tech stocks were under pressure as well, after Marvell delivered a weak earnings report, that blamed Research In Motion , a major customer, for some of its results, Rovelli at Canaccord Genuity said. At least two brokerages cut their price target for Marvell. Most of the semiconductor sector was down.
Intel also sank even after brokerage Robert W. Baird raised its rating on the tech giant to "outperform" from "neutral," saying its recent field research points to favorable trends.
Monster Worldwide shares plunged more than 7 percent to lead the S&P 500 decliners after brokerage William Blair & Co. cut its rating on the stock to "market perform" from "outperform."
Among Dow giants, Wal-Mart traded flat even after news the big box retailer said it is planning to raise its dividend by 21 percent. And Boeing also was flat after Reuters cited sources as saying European rival EADS was set to concede defeat in a decade-long battle with the group by deciding not to appeal a $30 billion U.S. tanker contract.
Volume on the consolidated tape of the New York Stock Exchange was 4.4 billion, while 1 billion changed hands on the NYSE floor.
In the day's economic news, nonfarm payrolls added 192,000 jobsin February, according to the Labor Department, while the private sector added 222,000, largely in line with expectations. The unemployment rate fell to 8.9 percent, the lowest since April 2009. The number of jobs added in January rose to 63,000 from the 36,000 first reported.
Economists surveyed by Reuters expected payrolls to rise by 185,000 with some investors expecting a reading above 200,000. The unemployment rate was expected to have risen to 9.1 percent from 9 percent the month before.
"It wasn’t a blow-out number," said Jeffery Kleintop, chief market strategist at LPL Financial in Boston. (Read More: Why Investors Weren't Cheered Much by February Jobs Report)
Averaging the results from February as well as January, which was affected by huge winter storms across the country, there were about 140,000 jobs created each month, Kleintop noted.
"That’s OK, but not quite strong enough to suggest we are out of the woods yet," he said.
As Kleintop points out, 8.7 million jobs were lost during the economic downturn, and the economy has only gained back 1.25 million. "We have a long way to go," he said. "But today’s data is an important step on that way to recovery. It's the strongest number since the recovery began."
Other analysts said that the market's muted reaction toward the jobs report largely reflects the fact the market rose so sharply in the prior session.
"Much of yesterday’s equity rally was 'jobs induced' rather than oil related," Dan Greenhaus, chief economist strategist at Miller Tabak & Co. said in a note to clients Friday. "As such, our gut feeling was that a number closer to 250K would have been necessary to sustain the rally, at least initially."
But Greenhaus added, "we must note that this is, relatively speaking, a pretty decent jobs report."
Meanwhile, January factory orders rose by 3.1 percent,much more than expected, helped by a boost in aircraft orders, the Commerce Department reported. Economists surveyed by Reuters had expected factory orders to rise by only 2.1 percent. Factory orders had risen 1.4 percent in December.
And overseas, European shares ended their second straight week in the red.
What to Watch Next Week:
MONDAY: Atlanta Fed President speaks, consumer credit; earnings after-the-bell from Urban Outfitters.
TUESDAY: McDonald's February sales data, 3-year Treasury note auction, BofA investor conference, Nvidia analyst meeting.
WEDNESDAY: Mortgage applications, wholesale trade, oil inventories, 10-year Treasury note auction, BofA/ML consumer conf., Citi 2011 financial services conference, anniversary of S&P 500 closing low (2009); earnings before-the-bell from American Eagle Outfitters and after-the-bell from H&R Block.
THURSDAY: BoE announcement, international trade, jobless claims, quarterly services survey, 30-year Treasury bond auction, Treasury budget, money supply, Nasdaq peak anniversary; Earnings before-the-bell from Smithfield Foods and after-the-bell from National Semiconductor.
FRIDAY: Retail sales, consumer sentiment, business inventories, S&P index rebalancing info due, Apple's iPad 2 ships; earnings before-the-bell from Ann Taylor.
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