Stocks close mixed Friday; Dow fell 6.2% for the week

NEW YORK -- Investors have gotten used to bad news, but layoffs topping 600,000 a month still made for a volatile day on Wall Street..

Stocks ended another difficult week with an equally difficult session Friday: Stocks rose, fell, then clawed their way back to a mixed close after the Labor Department released its February jobs report.

But while the market finished well above its lows — the Dow Jones industrials had a modest gain after falling more than 120 points — many market watchers say there's no reason stocks can't slide further, even as the major indexes are near 12-year lows.

"My sense is we haven't discounted all the negatives out there as of yet," said Rob Lutts, president of Cabot Money Management.

The Dow rose 32.50, or 0.5%, to 6,626.94. The Standard & Poor's 500 index rose 0.83, or 0.12%, to 683.38, while the Nasdaq composite index fell 5.74, or 0.44%, to 1,293.85.

The Dow is down 6.2% for the week and the S&P 500 index is down 7%. Both have fallen more than 24% since the start of 2009; the Dow is at its lowest point since the spring of 1997, and the S&P 500 is at its lowest level since September 1996.

The Nasdaq is down 6.1% for the week, and at a six-year low.

Three stocks fell for every two that rose on the New York Stock Exchange. Consolidated volume came to 7.21 billion shares, down from Thursday's 7.28 billion.

Big institutional investors are still largely waiting for positive signs from the economy before making any major commitments. As a result, the market is largely being driven by "short" traders, who sell borrowed stock and then buy it back later in hopes that the price will decline in the meantime. That makes for a choppy, unpredictable market — one that analysts expect to stay erratic for the forseeable future.

"The shorts are having a complete field day in this environment," said Kent Engelke, managing director at Capital Securities Management in Glen Allen, Va. "Right now you have everybody so fearful, and these shorts are controlling the market."