Stocks tepid as gold continues its hot streak

Gold topped $800 an ounce in New York on Friday for the first time since 1980 as record oil prices, all-time lows in the dollar and the ongoing global credit crunch led investors to seek the precious metal as a haven.

Major stock indexes, meanwhile, spent most of the day in negative territory despite a favorable report on job growth but managed to end the session on the positive side after recording sharp declines Thursday.

Oil prices rebounded after falling Thursday. Crude futures jumped $2.44 to a record $95.93 a barrel. The price was up 4.4% for the week as traders bet that global demand won’t dim much soon.

Gold futures for November delivery shot up $15, or 1.9%, on Friday to $805.70 an ounce in New York. The December gold contract rose $14.80 to $808.50, the highest closing price for a most-active contract since January 1980, when the metal reached an intraday record of $873.

Gold has rallied 27% this year as the dollar has plunged against key currencies. The metal’s image as a hedge against oil-led inflation, and concerns about financial firms’ health stemming from the sub-prime mortgage crisis, also have buffed the price.

Gold’s gains are “reflecting growing apprehensions that something in the financial system might go awry, despite maneuvers designed to keep things going,” said Jon Nadler, an analyst at Kitco Minerals & Metals Inc. in Montreal.

In the stock market, Friday’s session ended a week made turbulent not only by more bad news from the financial sector but also by surging commodity prices and hints from the Federal Reserve that it might not reduce interest rates further in coming months.

A highly anticipated government report Friday showed that employers added a net 166,000 jobs in October -- double what analysts expected -- but didn’t give stocks much of a lift a day after a sharp pullback fueled by investors’ unease about the financial sector’s outlook.

The Dow Jones industrials, which tumbled more than 360 points Thursday, ended up 27.23 points, or 0.2%, at 13,595.10 on Friday after being down more than 120 points at one point in the session. The Standard & Poor’s 500 index rose 1.21 points, or 0.1%, to 1,509.65.

The Nasdaq composite index rose 15.55 points, or 0.6%, to 2,810.38. The Russell 2,000 small-stock index added 0.3%.

The Dow and the S&P; 500 ended the week with losses, with the Dow dropping 1.5% and the S&P; off 1.7%. The Nasdaq managed a gain of 0.2%.

Treasury bond yields fell as worries about the financial sector trumped the strong employment report. The yield on the 10-year Treasury note eased to 4.32% from 4.35% on Thursday.

The dollar continued its steep decline, with the euro reaching a record $1.45, up from $1.446 on Thursday and $1.439 a week ago.

Financial institutions were among the biggest losers in the stock market Friday, as they have been in recent months. Several analysts expressed concern this week about banks’ and brokerages’ exposure to the strained credit markets and the possibility that further asset write-downs were coming.

Economic news that arrived Friday, like data released earlier in the week, was mixed. The unemployment rate held steady at 4.7%, in line with September and analysts’ consensus forecast but only because the size of the civilian labor force shrank.

Jack Ablin, chief investment officer at Harris Private Bank in Chicago, said the stock market should have been upbeat about the jobs report.

“I think investors who are worried about the direction of the economy should take comfort that we still have an engine,” Ablin said, referring to employment. “We know we can’t rely on the consumer to keep spending the way that they have, but we can point to job growth and wage gains as solid evidence that our economy is on solid footing.”

As has occurred frequently in recent weeks, technology issues outperformed much of the broader market Friday. Cisco Systems added 33 cents to $32.51. Google jumped $8.04 to a record $711.25.

Citigroup fell but pared much of the day’s losses after a report that the company’s board would hold an emergency meeting Sunday. Investors interpreted that news to mean Chief Executive Charles Prince might be on his way out. The stock closed down 78 cents, or 2%, at $37.73. The Wall Street Journal later reported that Prince would offer at the meeting to resign.

Among other financial issues, Merrill Lynch fell $4.91, or 7.9%, to $57.28; Washington Mutual sank $1.94, or 7.5%, to $23.81; Goldman Sachs fell $10.61, or 4.4%, to $229.60; and JPMorgan lost $1.17, or 2.6%, to $43.15.

Asian markets tumbled in the wake of Wall Street’s losses Thursday. Japan’s Nikkei stock average slumped 2.1%, while Hong Kong’s Hang Seng index fell 3.3%. In Europe, key stock indexes fell 0.8% in Britain, 0.4% in Germany and 0.2% in France.