Stocks Waver, But Poised to Post Best Week in Years

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A sizeable rally on Wall Street lost momentum on Friday, but stocks were still headed for their best week in years.

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Today's Markets

As of 3:12 p.m. ET, the Dow Jones Industrial Average rose 25.2 points, or 0.21%, to 12,046, the S&P 500 gained 3.7 points, or 0.29%, to 1,248 and the Nasdaq Composite gained 8.2 points, or 0.32%, to 2,635.

The financial sector led the gains on Friday, with big-name companies like Morgan Stanley (NYSE:MS) and Goldman Sachs (NYSE:GS) leaping higher.  Indeed, JPMorgan Chase (NYSE:JPM) and Bank of America (NYSE:BAC) were the best-performing Dow components by a wide margin. Hewlett-Packard (NYSE:HPQ) and Johnson & Johnson (NYSE:JNJ) by contrast, were the worst-performing blue chip.

Utilities provided somewhat of a counterbalance on the day as well, with stocks like Exelon (NYSE:EXC) sustaining moderate losses.

The S&P is on track to mark its best weekly performance since March 13 2009, which is the date that kicked off the current bull market. Indeed, the index has nearly doubled since hitting its bear-market low of 666.79 on March 6, 2009.

U.S. Treasury yields continued jumping as equity markets have rallied.  The benchmark 10-year note yields 2.113% from 2.003%.

The Labor Department reported nonfarm payrolls rose by 120,000 in November, slightly less than the 122,000 economists had expected. The unemployment rate unexpectedly fell to 8.6% from 9%, hitting its lowest level since March 2009.

The private sector tacked on 140,000 jobs, while the government shed 20,000 in a trend that has been seen in recent reports. The unemployment rate is calculated by comparing the number of unemployed to those individuals in the workforce.  In November, 315,000 individuals left the workforce, which was a factor in pushing the unemployment rate lower.

The blue chips have added close to 800 points since Monday and are now more than 3% to the upside for the year.  Meanwhile, the broader S&P 500 and Nasdaq have trimmed their year-to-date losses to 1%.

French President Nicolas Sarkozy after the market closed on Thursday proposed tighter fiscal integration for euro zone countries, and for the creation of a European Monetary Fund, which would be able to aid ailing countries preemptively.  The proposed body would be able to make decisions based on a majority vote instead of a unanimous one, which would make the process of providing rescue aid much quicker. This move comes ahead of a summit next Friday in which market participants hope leaders will be able to reach a comprehensive solution on tackling the debt crisis.

The new head of the European Central Bank, Mario Draghi, also hinted on Thursday that the central bank may launch an action in European debt markets in exchange for countries taking stronger steps on reining in sovereign debt.  However, it is important to note that Draghi came short of actually proposing an explicit measures.

The ECB is also mulling making a $270 billion loan through the International Monetary Fund to aid European countries in need, according to a report by Bloomberg News.  Officials at the ECB did not immediately respond to requests for comment on the matter.

European blue chips jumped 1.2%, while the euro sunk 0.42% to $1.341.

Energy markets were higher.  The benchmark crude oil contract traded in New York gained 76 cents, or 0.76%, to $100.96 a barrel.  Wholesale RBOB gasoline jumped 6 cents, or 2.3%, to $2.62 a gallon.

In metals, gold gained $11.50, or 0.66%, to $1,751 a troy ounce.

Foreign Markets

European blue chips jumped 1.2%, the English FTSE 100 rallied 1.2% to 5,552 and the German DAX climbed 0.74% to 6,0881.

In Asia, the Japanese Nikkei 225 edged higher by 0.54% to 8,644 and the Chinese Hang Seng rose 0.2% to 19,040.

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