By Geoffrey Rogow
U.S. stocks swung from a deep decline to slightly higher Friday morning after a report showed the nation's unemployment hit its highest level in more than 26 years in October.
Shortly after the opening bell, the Dow Jones Industrial Average (DJI) traded up 5 points at 10,0018.
The Standard & Poor's 500 Index (SPX) rose 2 to 1,069, while the Nasdaq Composite (RIXF) increased 5 to 2,111.
In the commodities markets, gold for November delivery gained 1% to $1,100 an ounce, the highest level for a front-month contract. The more actively traded December contract rose to $1,101.90 an ounce.
Earlier, the Dow had traded off about 70 points before paring its declines quickly. Financials and consumer companies were the hardest hit with J.P. Morgan Chase (JPM) , American Express (AXP) and Walt Disney (DIS) pacing the move lower. Both sectors had been at the forefront of a 200-point rally in the Dow on Thursday.
Helping keep the Dow in the green, General Electric (GE) rose 4.7%. Oppenheimer boosted its rating on the stock to outperform from perform, saying the group's financial portfolio is stabilizing.
Broadly, the market was weighed down after the Labor Department reported U.S. unemployment rose by more than expected in October and employers cut more jobs than forecast, a sign the labor market continues to struggle as the economy emerges from its deep recession.
The jobless rose by 0.4 percentage point to 10.2%. Economists surveyed by MarketWatch had forecast an increase to 9.9%.
Nonfarm payrolls fell by 190,000 last month, with the largest job losses in construction, manufacturing, and retail trade. Economists had expected a drop of 150,000.
On Wall Street, traders noted some surprise that the morning's declines weren't more severe, especially given the big jump on Thursday.
Mark Turner, co-head of sales trading for Instinet, said stocks were getting a lift from transports, which were helped by a decline in oil prices.
"And though the headline number on jobs was pretty bad, some of the revision numbers were actually a little better," said Turner. "That's why there wasn't a huge move to the downside."
Notably, September's nonfarm payrolls report was revised to a decline of 219,000 jobs from the previously reported 263,000-job decline.
In other markets, Treasury prices were mixed, with the 2-year noted up 1.32 to yield 0.860% and the 10-year down 1/16 to yield 3.535%.
The dollar fell against both the euro and the yen.
Among stocks to watch, Starbucks rose 4.8% after raising its earnings outlook for next year and reported a $150 million fiscal fourth-quarter profit.