Stocks reversed course Thursday to finish in the red as investors voted to cash on in recent rallies despite some impressive earnings from big names and some upbeat news on the jobs front.
The Dow Jones industrial average eased 7.26 points, or 0.07%, to 10,664.73. The broader Standard & Poor's 500-stock index lost 4.76 points, or 0.41%, to 1,147.06. The tech-heavy Nasdaq composite index was the worst performer among the major market benchmarks, falling 30.51 points, or 1.47%, to 2,045.96.
Wall Street will consider a new batch of earnings reports on Friday, including results from biopharmaceutical outfit EntreMed (ENMD), genomics company Gene Logic (GLGC), and executive search concern Heidrick & Struggles (HSII).
On the economic data front, a key gauge of inflation at the consumer level will also be released on Friday. The consumer price index (CPI) for January to rise 0.3% vs. a 0.2% rise in December, economics research firm Informa Global Markets forecasts. Excluding volatile food and energy components, the CPI is seen increasing just 0.1%, in line with the 0.1% increase in the core reading from the previous month.
Keeping the Dow from falling further was strength in Wal-Mart (WMT). The world's largest retailer reported that its quarterly profits jumped 11%, thanks to increased demand for winter clothing due to the cold weather.
Investors appeared to shrug off positive news on the labor market. The number of claims from workers applying for first-time jobless benefits dropped by a more than expected 24,000 to 344,000 in the week ended Feb. 14 from a revised 368,000 the previous week.
In other stocks news, microchip equipment maker Applied Materials (AMAT), which reported fiscal first-quarter earnings per share of 12 cents (excluding charges), above analysts' forecast of 8 cents and a loss of 4 cents a year ago.
Broadcom (BRCM), a maker of broadband-communications chips, raised its guidance for first-quarter revenue growth from 10% to a range of 16% to 18% from the previous quarter.
Small business and personal finance software outfit Intuit (INTU) reported higher quarterly profit rose as sales of its TurboTax software gained 36%.
Wireless carrier Nextel (NXTL) posted lower quarterly profit on 29% higher revenues as last year's figures had been boosted by the sale of its international unit NII Holdings.
In other economic news, the Philadelphia Fed Index for February came in softer than expected at 31.4, vs a prior 38.8 and expectations of a 34.5 reading, according to Informa Global Markets. The orders index came in at 27.8 vs a prior 36.5. Prices were the notable exception to the softening patter, prices paid at 43.7, vs. 35.3, prices received at 18.9, vs. 9.4. The number of workers sank to 12.5. vs. a prior 17.5. These are, of course, still healthy figures, notes Informa - just shy of expectations by a considerable margin. Expectations "remain positive", according to the text.
Meanwhile, the index of leading economic indicators climbed 0.5% in January, though gains were rather narrowly based. Over the past six months, the index is up 2.0%, with eight of 10 components showing gains.
In other equities news, retailer Target (TGT) reported profits that topped expectations, fueled by growth at its Target stores and credit card business.
RadioShack (RSH) posted a rise in quarterly profits as the third largest U.S. consumer electronics chain controlled costs and improved gross margins.
Telecom carrier Qwest (Q), which is the subject of an accounting probe, posted a fourth-quarter loss as weak local telephone sales offset strength long-distance and Internet services.
After earlier losses, Treasuries rallied back to end higher in afternoon trading after the release of the weaker than expected Philly Fed data. The lower closing in stocks was also bullish for Treasuries.
European stock markets closed higher on Thursday.
London's Financial Times-Stock Exchange 100 index was up 72.70 points, or 1.64%, to 4,515.60 as January retail sales rose more than expected 0.6% in January after rising 0.8% in December. BHP Billiton was higher as it doubled fiscal second-quarter earnings as China boosted purchases of iron ore. Royal Bank of Scotland was also higher after it said 2003 earnings rose 17%.
In Paris, the CAC 40 rose 50.30 points, or 1.36%, to 3,759.32 as the French current account surplus rose 14% in December as imports fell. 34 CAC stocks were higher, 6 were lower on the turnover of 30,916,000 shares. Retailer Carrefour was higher, boosted by rumors Wal-Mart might make bid for company. Arcelor was also higher after reporting a 2003 profit vs. a loss in 2002.
Germany's DAX index added 46.19 points, or 1.13%, to 4,141.53 on a report German fourth quarter gross domestic rose 0.2%, as expected. 28 DAX stocks were higher, 1 was lower on a turnover of 33,810,000 shares. Hugo Boss was higher as it was expected to report higher earnings. Allianz was higher on the increased sale of subordinated bonds to 1.5 billion euros. Meantime, DaimlerChrysler (DCX) was lower after it said its Chrysler unit an operating loss last year.
Asian markets finished mixed Wednesday. In Japan, the Nikkei 225 index gained 76.99 points, or 0.72%, to 10,753.80. Shinsei Bank attracted robust popularity on the first day of its trading on the main section of the Tokyo Stock Exchange Thursday, with its bid-only prices surging to almost 60% higher than its initial public offering prices.
In Hong Kong, the Hang Seng index eased 61.16 points, or 0.44%, to 13,867.22.