NEW YORK (CNN/Money) - Uncertainty about when the war with Iraq might end and the level of resistance and danger U.S. troops could face in their fight for Baghdad led stocks to drift back and forth over the unchanged mark in morning trading Friday.

But, as has been the pattern in recent days, the markets pretty much ignored a weak jobs report.

Around 11:20 a.m. ET the Dow Jones industrial average (up 26.82 to 8267.20, Charts) and the S&P 500 index (up 1.93 to 878.38, Charts) were barely changed, trending higher. The Nasdaq composite (down 8.53 to 1388.05, Charts), the weakest performer of the three, logged declines.

"We had negative unemployment data, but the market's not focusing on that," said Peter Cardillo, director of research at Global Partners Securities. "The market continues to focus on the news from Iraq. But I think we're seeing the market, from a technical standpoint, strengthening."

With U.S. troops controlling a good part of the national airport in Baghdad and some 2,500 Iraqi National Guards surrendering, Wall Street watched the war action with glee and looked the other way when the March employment report showed some 108,000 non-farm jobs vanished in the month. The unemployment rate stayed the same, however, at 5.8 percent.

Ignoring economic weakness at home in the hope that much of it will be resolved when the war in Iraq is over has been the market's modus operandi all of this week. It started Tuesday when the market shrugged off news that the manufacturing sector of the economy is actually in contraction and continued Wednesday when Wall Street barely noticed that factory orders in March shrank by twice what had been expected. On Thursday, news that many more people found themselves filing for unemployment benefits than economists had predicted was largely ignored as well.

The going bet in the market is that the one big thing preventing businesses and consumers from spending is the war in Iraq. But now that the war seems as though it will be over in weeks, not months, Wall Streeters found no reason to sell stocks in the face of the depressing jobs report.

"Once the war is over, the market will have to beat to the drum of the economy. But, for now, it's dancing to the tune of war," said Cardillo.

In the latest news from Iraq, the country's information minister said Iraqi troops would not use chemical weapons, but might stage martyr attacks using people as human shields. Iraqi TV also released footage of Saddam Hussein encouraging his people to use any means necessary to fight off coalition forces. Whether the tape is new or old has not yet been confirmed. There is much speculation as to whether Hussein is alive or dead -- or if he may have left the country. (For full war coverage, go to CNN.com.)

Market breadth was mixed, with eight stocks rising for every seven that fell on the New York Stock Exchange as 451 million shares traded. On the Nasdaq, decliners edges past advancers on volume of 594 million shares.

Few individual issues stood out in the early going. Dow member Alcoa (AA: up $0.08 to $19.99, Research, Estimates), set to be the first industrial component to report its earnings this season after the closing bell, edged slightly higher.

The Dow continued to be pressured by Altria Group (MO: down $1.49 to $28.21, Research, Estimates), formerly Philip Morris, after news late Wednesday that the tobacco maker is likely to be sued by 46 states if it misses a $2.5 billion payment for a tobacco settlement agreement due to these states on April 15.

The relatively good mood in stocks soured the day for U.S. Treasury bonds. The 10-year note lost 7/32 of a point in price, its yield edging up to 3.93 percent. The dollar advanced against major currencies.

World markets trended higher. European stocks scored gains in afternoon trading and Asian exchanges closed higher as well.

Key commodity prices retreated. Light crude oil lost 64 cents to $28.33 a barrel in New York. Gold eased 10 cents to trade at $325.60 an ounce in New York.