By Herbert Lash

NEW YORK (Reuters) - U.S. stocks rose late on Friday after a rebound in bank shares offset fears stemming from a bleak U.S. jobs report that had sunk equity markets earlier and led investors into safe-haven debt.

The U.S dollar retreated from 11-month highs after government data showed the U.S. economy lost jobs for the eighth straight month in August and the unemployment rate jumped to nearly a five-year high.

Evidence of slowing global demand helped push crude oil down to a fresh five-month low and hammered industrial metals after a hefty rise in copper inventories triggered a sell-off.

Copper and aluminium tumbled to seven-month lows, lead and tin prices shed about 5 percent and grain prices in Chicago fell almost as sharply. Crude's fall to around $106 a barrel extended the week's losses to about 8 percent.

The MSCI main world equity index fell 6.2 percent for the week, its biggest weekly decline in more than five years.

News that the U.S. unemployment rate soared to 6.1 percent last month from 5.7 percent in July initially rattled investors who dumped shares and fled to the safety of government debt.

European shares closed down more than 2 percent and U.S. stocks fell more than 1 percent before rebounding on news that said two private equity firms were each looking to buy parts of Lehman's real estate and asset management units.

The Reuters report, based on sources familiar with the situation, sparking a broad rebound in financial stocks.