Stocks end mixed on jobs, services data

The stock market seemed to dodge a couple of bullets Thursday, but the Dow Jones industrial average's modest rebound during a half-day session couldn't salvage the week.

And take a guess which commodity closed at yet another record high.

The Dow added 73.03 points, or 0.6%, to 11,288.54, but lost 0.5% for the week and stayed in bear-market territory, off 20.3% from its October record high.

The broader market was much worse, for the day and the week. Investors continued to unload some of the stocks that held up best for them in the second quarter, particularly smaller issues. The Russell 2,000 small-stock index lost 1% on Thursday and 4.6% for the week, and is down 22.2% from its all-time high reached nearly a year ago.

The slow-motion crash in bank stocks also continued, suggesting no easing of the latest jitters over the financial system. On the list of fresh multiyear lows Thursday: Bank of America, Wachovia, Comerica and Zions Bancorp, among others.

Although an index of activity in the service sector fell more than expected, the government's report of a net loss of 62,000 jobs in the economy in June nearly matched expectations, so that was a relief to some on Wall Street.

Should it have been? The debate over whether we are, or aren't, actually in a recession will go on, but to some analysts there's no question anymore.

Merrill Lynch & Co. economist David Rosenberg says the lesson from history is that "you don't have six consecutive monthly declines in payrolls and not be in an outright recession."

For stock investors, the issue is what the slowdown or recession will mean for corporate earnings. Analysts have a dismal view of results for the quarter that just ended: Operating earnings of the Standard & Poor's 500 companies overall are expected to be down 12.4% from a year earlier, according to Wall Street estimates tracked by Thomson Reuters.

Yet those same analysts still believe the second half will bring a big turnaround. They're expecting a 12.7% year-over-year gain in S&P 500 earnings in the third quarter.

But you have to wonder what will happen to that third-quarter estimate if oil stays where it is, or goes higher. Near-term crude futures in New York jumped $1.72 on Thursday to a record $145.29 a barrel.

Not even a surprise rally in the dollar -- normally a drag on commodity prices -- could keep oil from doing what it does best: defying everyone who's trying to talk it down.