NEW YORK — If you looked away Friday, you might have missed a market rally. Or a plunge.
A soothing government report on employment in July eased concerns that the U.S. might slide back into a recession, and the Dow Jones industrial average rose as much as 171 points soon after trading began. But fears that Europe's growing debt crisis might threaten U.S. banks and the fragile economy ruled Friday.
After its early rise, the Dow fell more than 400 points and was down 243 just before noon. Then it rose nearly 400 points in less than an hour and was up 135 points. The rest of the day, the blue-chip stock index bounced up and down, sometimes by as much as 100 points in less than half an hour.
The Dow Jones industrial average ended the day up 61 points, or 0.5 percent.
Stocks have been "like a tether ball being smacked around the pole" by worries about weakening economies around the world, said Sam Stovall, chief investment strategist for Standard & Poor's Equity Research.
Even less-developed countries like Brazil and China, which have been the motor of global growth for three years, are slowing. Brazilian stocks have dropped nearly 30 percent since Nov. 4 as the country tries to stem inflation. Manufacturing in China shrank in July for the first time in a year.
In Europe, debt problems are spreading, threatening the continent's third- and fourth-largest economies. In the U.S, a possible debt default was averted this week, but concerns remain. Chief among them: less spending by consumers, which is leading to anemic growth by both manufacturing and service companies, and too few new jobs to lower the unemployment rate significantly.
Investors also worry the federal government is more likely to hurt the economy than help it. Instead of more spending, the government is trying to reduce its budget deficits by spending less.
Randy Warren, chief investment officer at Warren Financial Service, said markets were jittery over how leaders in the U.S. reacted to the debt negotiations and how leaders in Europe have reacted to the growing debt problems there.
"The fear was that they had no plan to deal with the situation," Warren said.
In Europe, Italy or Spain could become the next country unable to repay its debt. The two countries have Europe's third- and fourth-largest economies. European leaders and central bankers might not have the cash needed to prop them up until a larger financial rescue fund can be established.
In the U.S., few believe the government is likely to stimulate the economy through spending, as it did with its $800 billion stimulus program in 2009. Washington will instead cut spending by more than $2.1 trillion over 10 years to reduce the deficit.
"When investors took a step back and looked at the deal, it became clear that the long-term debt issues have yet to be resolved and that some hard decisions still need to be made," said Bob Doll, chief equity strategist at BlackRock. "Investors do not like uncertainty."
That contributed significantly to the up and down trading Friday and all week, strategists said.
All three major stock indexes are in correction, meaning they are down 10 percent or more off their recent highs.
The Dow Jones industrial average fell 5.8 percent this week. It plunged 513 points on Thursday alone, the worst day for the Dow since 2008.
The S&P 500, the benchmark for most mutual funds, fell 0.1 percent Friday. It is down 7.2 percent for the week and 10.8 percent since July 22, when its steady declines began.
The Nasdaq composite index fell 24 points, or 0.9 percent. It is down 11.4 percent since July 22.
Commodities also fell on worries that weaker global economies will mean less demand. Crude oil's price fell $8.82, to $86.88 over the week.
Overseas markets also fell. Tokyo, Hong Kong and China all closed down more than 2 percent. Germany's DAX index fell 2.8 percent.
Ron Florance, an investment strategist at Wells Fargo Private Bank, said he expected stocks to remain volatile for the next several weeks until it's clear how healthy - or unhealthy - the economy is.
Many analysts said the economy might not be as bad off as it seems. For one thing, companies have reported strong profits and are flush with cash. They also cut costs drastically during the recession.
Those in the S&P 500 have amassed more than $963 billion in cash. That's up from $610 billion at the start of the recession, according to S&P. Earnings in the second quarter rose 11 percent from a year ago for the 422 companies in the S&P 500 index that have reported so far.
Even so, only four of the S&P 500's 10 industry groups are up for the year: health care, utilities, telecommunications and consumer staples. Traders consider those companies relatively recession-resistant.