Stocks were trading higher late Friday, taking cheer in a solid jobs report despite rising bond yields and the potential for interest-rate hikes. Homebuilding, commodity and other groups that dragged the market down earlier in the week were strong, but semis erased early gains, says Standard & Poor's MarketScope.
In afternoon trading, the Dow Jones industrial average rose 72.44 points, or 0.66%, to 11,044.72. The broader Standard & Poor's 500 index bounced 5.71 points, or 0.45%, to 1,277.94. The tech-heavy Nasdaq composite index added 6 points, or 0.27%, to 2,255.72.
Investors were digesting a key labor report Friday. Nonfarm payrolls increased 243,000 in February, slightly more than forecast, says Action Economics. The unemployment rate rose to 4.8% for the month. In a separate report, January wholesale sales rose 1% in January, vs. an expected 1.5%.
The payroll numbers, while relatively tame, may keep the Fed on guard against inflation, analysts say. The data "support our view that the Fed will raise rates at each of the next three FOMC meetings, which would put the funds rate at 5.25% by midyear," says John Ryding, chief U.S. economist with Bear Stearns.
A flurry of deal activity was also in focus. Amazon.com (AMZN) reportedly was in talks with General Electric's (GE) Universal Pictures, Viacom's (VIA) Paramount and Time Warner unit Warner Bros, about providing their content on its site.
Financial services giant Citigroup (C) moved higher in afternoon trading after a report it may have contacted the French government about making a bid for French bank Societe Generale.
Univision (UVN) rose on a report that a group of investors including Mexican broadcaster Grupo Television and billionaire producer Haim Saban plans to bid $12 billion for the Spanish-language TV company.
Tech bellwether Google (GOOG) was lower after the Internet search giant bought Upstartle, maker of Web-based word processor Writely, in a move that competes directly with the core business at Microsoft (MSFT).
Newspaper publisher Knight Ridder (KRI) reportedly received takeover offers of at least $4.7 billion. Among the bidders were rival McClatchy (MNI) and a consortium of private equity firms.
Blackberry maker Research in Motion (RIMM) was also active on the deal front, scooping up software developer Ascendent Systems.
The Nasdaq Stock Market (NDAQ) surged after the London Stock Exchange said it rebuffed an unsolicited bid from the U.S. company. The newly public NYSE Group (NYX) was lower in its third day of trading.
Elsewhere, Big Three automaker General Motors (GM) recalled about 900,00 pickup trucks because of tailgate problems.
In earnings, telecom equipment maker Nortel Networks (NT) posted a $2.21 billion fourth-quarter loss and said it would restate previous financial statements due to accounting problems. Dreamworks Animation (DWA) tumbled after posting lower fourth-quarter earnings.
Among other companies in the news, radio giant Clear Channel (CCU) set a $600 million stock buyback.
In the energy markets Friday, April West Texas Intermediate crude oil futures closed down 52 cents at $59.96 a barrel.
European markets finished higher. In London, the Financial Times-Stock Exchange 100 index rose 52 points, or 0.89%, to 5,907.9. Germany's DAX index added 72.27 points, or 1.27%, to 5,804.92. In Paris, the CAC 40 index climbed 61.43 points, or 1.23%, to 5,069.27.
Asian markets finished mixed. Japan's Nikkei 225 index rose 78.82 points, or 0.49%, to 16,115.63. In Hong Kong, the Hang Seng index fell 65.08 points, or 0.42%, to 15,445.05. Korea's Kospi index gained 8.86 points, or 0.68%, to 1,320.07.
Treasury yields rose modestly Friday, propped up by the one-two punch of jobs data and a record $119.2 billion budget deficit in February. Prices for 10-year Treasury notes were lower in afternoon trading at 97-31 with a yield of 4.76%, while 30-year bonds fell to 96-05/32 for a yield of 4.74%. The yield curve between two- and 10-year Treasuries was set to end the week in positive territory for the first time since Jan. 31.