NEW YORK (AP) -- Wall Street showed some reassuring signs of stability Friday, closing mostly higher despite the biggest monthly decline in jobs in five years. The major indexes ended the first four sessions of the second quarter with a healthy advance.++
While some nervous investors fled to government bonds, the report, showing the economy gave up 80,000 jobs last month, appeared to simply confirm many investors' assumptions of a widespread economic slowdown.
Although the job losses, the most since March 2003, are indeed a significant sign of economic weakness, a lackluster report was widely expected, and some investors were relieved the total was not higher. Thomson/IFR had projected 15,000 jobs were lost in March, but some economists expected 150,000 cuts.
Payrolls for January and February were revised lower by a total of 67,000 and the unemployment rate shot up to 5.1 percent, the highest since September 2005. The economy has given up about 232,000 jobs in the first three months of this year, and the latest report adds fuel to the belief of many economists that the U.S. is already in recession.
"The economic data is negative, but I think what the market's telling us is we've priced in a lot of the bad news already," said Arthur Hogan, chief market strategist at Jefferies & Co. "You could make the argument that we've thrown a lot of difficult news at this market and it's reacted very well."
The market's next big test is likely to come with the release of first-quarter earnings reports in the coming weeks. Investors will be particularly keen to know what companies' outlooks are for the rest of this year - if they are disappointing, Wall Street could see a return of the punishing volatility of the past few months.
The Dow Jones industrial average slipped 16.61, or 0.13 percent, to 12,609.42, in part because of a decline in General Motors Corp. stock.
Broader stock indicators edged higher. The Standard & Poor's 500 index added 1.09, or 0.08 percent, to 1,370.40, and the Nasdaq composite index advanced 7.68, or 0.32 percent, to 2,370.98.
Though the major indexes showed modest moves, advancing issues outnumbered decliners by about 3 to 2 on the New York Stock Exchange, where consolidated volume came to 3.59 billion shares compared with 3.77 billion traded Thursday.
For the second quarter, which began Tuesday, the Dow is up 2.83 percent, the S&P 500 gained 3.61 percent, and the Nasdaq added 4.03 percent. For the entire week, the Dow rose 3.22 percent, the S&P 500 added 4.20 percent and the Nasdaq gained 4.86 percent.
Treasury prices jumped after the jobs report, as investors often seek the safety of government-backed bonds amid uncertainty about the economy. The yield on the benchmark 10-year note, which moves opposite its price, fell to 3.47 percent in late trading from 3.59 percent late Thursday.
The dollar was mixed against other major currencies, while gold prices rose.
Light, sweet crude rose $2.40 to settle at $106.23 a barrel on the New York Mercantile Exchange. Retail gas prices, meanwhile, surged to a new record above $3.30 a gallon, and appear ready to rise further as supplies tighten ahead of the summer driving season.
Investors' assessment of the economy comes after a strong week for Wall Street. Monday brought the welcome end to a downbeat first quarter. While the S&P 500 fell nearly 10 percent during the first three months of the year, stocks had managed to pull off their lows by quarter's end.
On Tuesday, the Dow surged nearly 400 points as investors snapped up shares of financial companies, which have fallen sharply in recent months on concerns about bad debt on balance sheets. The quiet sessions since, including Friday's modest moves in the face of bad economic news, appeared to buoy some hopes that the market is carving a bottom after five months of declines in the S&P.
Friday's advance followed a gentle rise on Thursday in response to Federal Reserve Chairman Ben Bernanke's remarks that the Fed expects to recover most, if not all, the $29 billion worth of loans it made to keep struggling Bear Stearns Cos. from collapse. Bernanke's comments to the Senate Banking Committee, in which he defended the central bank's decision to aid JPMorgan Chase & Co.'s takeover of Bear Stearns, were calming to investors hoping that demand is returning to the tight credit markets.
Other central bankers and business leaders appearing before the committee indicated they were able to avert a financial catastrophe with Bear Stearns sinking quickly toward bankruptcy.
Remarks by Bernanke earlier in the week left the door open to another interest rate cut from the Federal Reserve.
"This (jobs) number still supports the notion that there's likely going to be more monetary policy easing by the Fed," said Michael Strauss, chief economist at Commonfund, noting that investors appear to be considering that the central bank's steps often take time to filter into the economy.
Figures like employment numbers also lag, noted Hogan. "The unemployment rate will go higher before the recession is over," he said. "I think the market is trying to tell us we understand that, we've seen this before"
"I think there are market participants who are looking through the valley and saying they're seeing the other side," he added.
In corporate news, GM fell after a private equity group said it terminated its agreement to invest $2.55 billion in the company's largest auto parts supplier, Delphi Corp., which has been trying to emerge from bankruptcy protection. GM fell $1.01, or 4.7 percent, to $20.58.
On Friday, the Russell 2000 index of smaller companies rose 0.16, or 0.02 percent, to 713.73.
Overseas, Japan's Nikkei stock average fell 0.72 percent. Britain's FTSE 100 finished up 0.95 percent, Germany's DAX index rose 0.32 percent, and France's CAC-40 added 0.27 percent.