(Updates to close)
By Ellis Mnyandu
NEW YORK, Dec 7 (Reuters) - U.S. stocks ended little
changed on Friday as a sharp drop in oil prices and signs of
resiliency in the labor market offset concerns that tighter
credit is hurting consumer spending.
A drop of more than 2 percent in oil prices buoyed shares
of big manufacturers like Boeing Co <BA.N> and 3M Co <MMM.N>.
Data showing modest payrolls growth in November helped ease
recession fears and showed the job market remains resilient despite
the crumbling housing market and tight credit conditions.
Credit card companies' shares fell, however, after brokers
downgraded the stocks and said tightening credit was pressuring not
only the economy, but consumer credit performance.
Shares of American Express Co <AXP.N> fell more than 4
percent, while Capital One Financial <COF.N> fell 5 percent.
"What looked like an economy that was falling apart as
recently as two weeks ago suddenly sees news that seems to be
better than expected," said Eric Kuby, chief investment officer
at North Star Investment Management Corp in Chicago.
The jobs report, he said, may have tempered expectations
for a far more aggressive cut in interest rates next Tuesday
when the Federal Reserve's policy-setters meet.
But as the market had rallied in recent days in
anticipation of a bigger cut, "if you don't get 50 basis points
next week, I think the market will be extremely disappointed."
The Dow Jones industrial average <.DJI> finished up 5.69 points,
or 0.04 percent, at 13,625.58.
But the Standard & Poor's 500 Index <.SPX> closed down 2.68
points, or 0.18 percent, at 1,504.66. The Nasdaq Composite Index
<.IXIC> slipped 2.87 points, or 0.11 percent, to 2,706.16.
For the week, however, all three major U.S. stock indexes
finished with gains -- with the Dow up 1.9 percent, the S&P 500
rising 1.6 percent and the Nasdaq gaining 1.7 percent.
Ahead of Friday's jobs report, investors had been hopeful
that the Federal Reserve was leaning toward cutting short-term
rates by a half percentage point to rescue a sinking economy
after recent comments by Fed officials.
The Labor Department report showed U.S. employers added
94,000 jobs last month, slightly above forecasts by Wall Street
analysts and a moderately positive sign for the economy.
Shares of jet plane maker and U.S. defense contractor Boeing
ended up 1.5 percent at $93.16 on the New York Stock Exchange, while
those of 3M, whose products include Scotch tape and Post-it notes,
gained 1.6 percent to close at $86.19. The two stocks were the top
contributors to the Dow's slim gain.
On the New York Mercantile Exchange, January crude <CLF8>
settled down $1.95, or 2.2 percent at $88.28 a barrel, after
trading from $87.07 to $90.68.
A DENT IN THE WALLET
American Express shares declined 4.3 percent to $56.96 and
shares of Capital One dropped 5.02 percent to $49.80.
On the Nasdaq, shares of biotech company Amgen Inc <AMGN.O>
led decliners, countering a rise in shares of Apple Inc
<AAPL.O>, the maker of the iPhone.
Amgen shares declined 5.5 percent to $52.10 after a brokerage cut
its price target on the stock, a day after the company said it was
talking with U.S. regulators about updating safety warnings for
anemia drugs amid concerns about their use by breast and cervical
cancer patients.
A bright spot was Apple, whose stock finished up 2.3 percent at
$194.30, extending gains from the previous two sessions on optimism
about the outlook for big tech.
Volume was modest on the NYSE, where only 1.20 billion shares
changed hands, far below last year's estimated daily average of 1.84
billion. On the Nasdaq, about 1.92 billion shares traded, below last
year's daily average of 2.02 billion.
Advancers outnumbered decliners on the Big Board by a ratio of 16
to 15. In contrast, on the Nasdaq, about 15 stocks fell for every 14
that rose.
(Editing by Jan Paschal)
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Keywords: MARKETS STOCKS