Job Figures Propel Yields to 11-Month High

Bonds reacted badly to the U.S. jobs report Friday, as long-term yields for the 30-year T-bond reached 5.82%--the highest level in 11 months.

But the stock market still rallied, with the Dow industrials ending up 84.77 points to a record 11,031.59. For the week, the Dow was up 242.55 points, or 2%, having closed above 11,000 for the first time Monday.

The market had anxiously awaited the Labor Department’s monthly jobs report, fearing it might point toward an increase in interest rates. But the news was better than expected. The unemployment rate in April edged up to 4.3%, from the 29-year-low of 4.2% in March, while the number of jobs created grew only slightly and wage pressures were muted.

Broader stock indicators were mostly higher. The Standard & Poor’s 500 index was up 12.95 points, or 0.7%, to close at 1,345.

Technology shares enjoyed moderate gains, lifting the Nasdaq composite index 31.34 points to close at 2,503.62.

On Thursday, Federal Reserve Chairman Alan Greenspan rattled financial markets after warning about inflationary pressures. He did not say the Fed would raise interest rates, but his comments put Wall Street on guard as bond yields marched higher.

The benchmark 30-year U.S. Treasury bond was off $3.4375 on a $1,000 bond. The yield rose to 5.81%--the highest since May 28, 1998--from Thursday’s close of 5.79%.

“There’s been a slight deterioration in psychology,” said Trude Latimer, an independent stock broker in Charlottesville, Va. “The traders are getting nervous. Some of the comments from the reigning geniuses are a little more cautious,” Latimer added, referring to Greenspan’s speech.

Meanwhile, gold plunged after the British Treasury announced plans to sell 125 tons of gold this financial year. In New York trading, gold fell $6.80, closing at $282.90. The dollar rose to 120.85 Japanese yen from 120.50 yen.

Friday’s big winner on the Dow was IBM, up $8 to $217.25. Analyst Gary Helmig at SoundView Technology released a bullish outlook on the computer giant’s second-quarter performance.

Among technology issues, America Online fell $1.56 to $118.19, Dell Computer rose 75 cents to $40.38, Amazon.com fell $1 to $136.38.

Financial stocks contributed most to the S&P; 500’s advance. Fannie Mae rose $3.56 to $72.13 after Chairman and CEO Franklin Raines predicted that earnings per share at the biggest provider of mortgage funding in the U.S. will double over the next five years.

Advancing issues outnumbered decliners by a narrow margin on the New York Stock Exchange, where consolidated volume came to 983.5 million shares, down from 1.05 billion on Thursday.

The NYSE composite index was up 5.02 points to close at 641.24, and the American Stock Exchange composite index was down 0.52 point at 787.29.

The Russell 2,000 index of smaller companies was up 2.73 points to close at 436.11.

Overseas, Japan’s Nikkei stock average fell 2.05%.

Among market highlights:

* Newmont Mining, the No. 1 U.S. gold miner, fell $3.31 to $22.75. Homestake Mining fell $1.19 to $9.44 and Barrick Gold, the world’s fourth-largest gold producer, slid $2.75 to $20.50.

* Avondale Industries jumped $4.31 to $36.06 after the shipbuilder received an unsolicited buyout offer from Litton Industries for $38 a share cash. Litton also made a proposal to buy Newport News Shipbuilding. Newport News rose $5.75 to $32.75. Litton fell $1.63 to $63.13.

* Intel rose $1.25 to $60.94 after analyst Erika Klauer at BT Alex, Brown maintained a “strong buy” rating on the world’s largest chip maker. Unit sales of microprocessors are still strong, she said, and she doesn’t see significant declines in average selling prices.

* Media Metrix, which measures the audiences of Internet companies, more than doubled in its first day of trading. The New York-based company’s stock closed at $45.56 a share, 168% above its $17 offering price and 38% above the $33 bid that opened trading on Nasdaq. The company closed with a market value of $762.2 million.

* QLogic soared $14.19 to $90.06 after the company said it earned 45 cents a share in the first quarter, up from 23 cents in the same 1998 quarter and above the 40-cent average estimate of analysts surveyed by First Call. QLogic makes products that link disk drives and other accessories to computers.

Market Roundup, C4

* LOW JOBLESS RATE: The U.S. unemployment rate hovered near a 30-year low in April. A1