After moving to the downside in early trading on Thursday, stocks staged a notable recovery attempt over the course of the trading day. The major averages climbed well off their worst levels of the day, eventually ending the session mixed.
While the Dow managed to climb into positive territory, the Nasdaq and the S&P 500 remained stuck in the red. The Dow crept up 18.97 points or 0.1 percent to 13,596.93, while the Nasdaq fell 6.66 points or 0.2 percent to 3,175.96 and the S&P 500 edged down 0.79 points or 0.1 percent to 1,460.26.
Disappointing jobs report contributed to the early weakness on Wall Street, with the Labor Department releasing a report showing that jobless claims came in above estimates in the week ended September 15th.
While jobless claims edged down to 382,000 from the previous week's revised figure of 385,000, economists had expected jobless claims to drop to 373,000 from the 382,000 originally reported for the previous week.
Peter Boockvar, managing director at Miller Tabak, said, "Bottom line, the labor market still can't gain any lasting traction in light of the obvious economic challenges."
A report showing a continued contraction in Chinese manufacturing activity also helped to drag stocks lower, although selling pressure was relatively subdued.
Traders remained reluctant to make any significant moves amid continued uncertainty about the near-term outlook for the markets.
The subsequent recovery attempt was partly due to the release of a report from the Philadelphia Federal Reserve showing that its index of regional manufacturing activity rose by much more than expected.
The Philly Fed said its diffusion index of current activity rose to a negative 1.9 in September from a negative 7.1 in August, although a negative reading still indicates a contraction in regional manufacturing activity.
Among individual stocks, shares of Adobe Systems (ADBE) moved notably higher even though the publishing and design software developer reported weaker than expected third quarter revenues and forecast fourth quarter results below analyst estimates.
Denbury Resources (DNR) also posted strong gain after announcing an agreement to sell its Bakken assets in North Dakota and Montana to Exxon Mobil (XOM) for $1.6 billion in cash
Meanwhile, Bed Bath & Beyond (BBBY) came under pressure after the home furnishings retailer reported second quarter earnings that came in weaker than expected.
In overseas trading, stock markets across the Asia-Pacific region saw considerable weakness during trading on Thursday. Japan's Nikkei 225 Index dropped by 1.6 percent, while Hong Kong's Hang Seng Index fell by 1.2 percent.
The major European markets also moved to the downside on the day. While the German DAX Index closed just below the unchanged line, the U.K.'s FTSE 100 Index and the French CAC 40 Index both ended the day down by 0.6 percent.
In the bond market, treasuries ended the day nearly flat after failing to sustain an early upward move. As a result, the yield on the benchmark ten-year note, which moves opposite of its price, edged down by less than a basis point to 1.777 percent after hitting a low of 1.723 percent.
Many of the major sectors recovered from their early lows, but substantial weakness remained visible among railroad stocks. The Dow Jones Railroads Index tumbled by 4.9 percent, pulling back further off last Friday's record closing high.
Norfolk Southern (NSC) helped to lead the railroad sector lower, with the railroad company plunging by 9.1 after warning of weaker than expected third quarter earnings.
Brokerage stocks also saw considerable weakness on the day, dragging the NYSE Arca Broker/Dealer Index down by 1.8 percent. Jefferies (JEF) turned in one of the sector's worst performances, falling by 7.3 percent despite reporting better than expected third quarter results.
Commercial real estate, airline, and trucking stocks also showed notable moves to the downside. On the other hand, housing stocks saw moderate strength, adding to yesterday's gains.
Amid a lack of major U.S. economic data, trading on Friday could be impacted by reaction to quarterly results from Oracle (ORCL). The business software giant is releasing its fiscal first quarter results after the close of today's trading.
by RTT Staff Writer
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