Stocks closed higher today after the government's jobs report showed continued economic strength with only mild inflationary pressures. Financial stocks, which benefit the most from stable interest rates, led the gains.
The Dow Jones industrial average closed up 64.84 points, at 10,704.48, after having risen 193 points in early trading. For the week, the Dow was down 25.38 points, or 0.2 percent.
Broader stock indicators also gave back some of their opening gains but still closed higher. The Standard & Poor's 500-stock index rose 7.59, to 1370.23, and the Nasdaq composite index rose 46.34, to 3102.29, its sixth consecutive record high close.
Prices rose after the Labor Department reported the nation's unemployment rate dipped to 4.1 percent in October, an almost 30-year low, as 310,000 workers found jobs. But despite the continued strength of the labor market, which can force companies to pay employees more, feeding inflation in the process, the average hourly wage rose by only 0.1 percent, to $13.37, less than many analysts had anticipated.
The data gave another boost to growing confidence that Federal Reserve officials will decide against raising interest rates again when they meet in two weeks. The Fed has already raised rates twice this year in an effort to slow the economy and guard against inflation.
Bonds, which are less attractive in times of inflation, rallied after the report's release. As prices rose, the yield on the 30-year Treasury dropped as low as 6.02 percent, down from a two-year high of 6.37 percent just last week. The yield finished the day at 6.05 percent, down from 6.10 percent on Thursday. Its price rose to $5.94 per $1,000 invested.
The improving interest rate outlook lifted the shares of financial services companies, which should enjoy strong demand for loans if rates remain stable. American Express rose 3-7/16, to 149 3/4, and J.P. Morgan gained 2 1/4, to 135 3/4, leading the Dow's advance.
The buoyant market helped two companies perform well in initial public offerings. Cobalt Networks, which makes computer server appliances, was priced at 22 and opened at 139. It closed at 128 1/8. Webvan, an online grocer, was priced at 15 and opened at 26. Later, it edged back to 24 7/8.
In after-hours trading, Internet grocer Peapod slid 3-11/16, to 8, after CNBC reported that the company said in a filing with the Securities and Exchange Commission that its existing cash and marketable securities may be "insufficient" to fund the company's operations next year, Bloomberg News reported.