Updated from 4:12 p.m. EST
Stocks closed slightly lower Thursday as mixed results from U.S. chain stores and an unnerving report on productivity and costs kept buyers at bay.
Dow Jones Industrial Average
slipped 12.48 points, or 0.1%, to 12,018.54, finishing down for a fifth straight day. The
dipped by 0.47 point, or 0.03%, to 1367.34, and the
gave up 0.33 point, or 0.01%, to 2334.02.
Weighing on the market was a Labor Department report that said third-quarter productivity registered no growth, below the consensus of a 1% rise. Unit labor costs, a key measure of inflation, rose 3.8%, above expectations of a 3.4% increase.
"There's genuine concern that the economy is slowing more than people think," said Edgar Peters, chief investment officer with Pan Agora. "There's also fear that inflation isn't letting up. The stock market held up pretty well today, considering that double whammy."
Volume weakened while breadth improved mildly from Wednesday's close. About 2.68 billion shares changed hands on the
New York Stock Exchange
, and decliners beat advancers by a 9-to-7 margin. Volume on the Nasdaq was roughly 1.94 billion shares, with losers outpacing winners nearly 3 to 2.
By sector, commodity stocks were among few winners of the session, as the Philadelphia Gold & Silver Index rose 0.4%. Utility stocks struggled, with the Philadelphia Utility Index losing 0.9%.
Separately, the government said initial jobless claims rose by 18,000 to 327,000 last week. The figure is the final read on employment ahead of the nonfarm payrolls data that are due Friday. Economists currently expect that the U.S. economy added 125,000 during October.
Additionally, the Commerce Department said U.S. factory orders rose 2.1% in September but came in below expectations.
"The excuse to sell has been that the soft landing is at risk," said Barry Hyman, equity market strategist with EKN Financial. "However, we haven't been pullbacks of any substance. We're at another technical level that has been a support for the market. There's a lot of skepticism in this rally, but I welcome this pullback, and I believe this is normal."
Because it's the first Thursday of the month, the bulk of the nation's retail-chain operators are reporting their same-store sales.
, the world's largest retailer, said same-store sales rose 0.5%, matching the estimate it had revised lower on Saturday.
Further exacerbating the bad news, the retailer said it expects sales to be flat for the month of November. Wal-Mart finished down 56 cents, or 1.1%, at $48.29.
, same-store sales slid 31%, and at
, comparable sales dropped 13.7%.
The news was the same for
, as comp sales declined 7% in October. Shares dropped $1.14, or 5.5%, to $19.50.
Among those with growing sales,
said October comp sales rose 10.7%, and
said last month's same-store sales were up 11%.
In other news,
Smith & Nephew
said it has held preliminary talks with
over a possible trans-Atlantic merger of orthopedic-device makers.
London-based Smith & Nephew emphasized in a press release that it "is constantly looking at opportunities to maximize shareholder value, including looking at potential strategic acquisitions." Shares of Smith & Nephew lost 3.1%, while Biomet ended the session 2.5% higher.
Among earnings releases,
posted third-quarter results that were up 12.5% from the same quarter a year ago and ahead of Wall Street's forecast by a penny. The earnings report, posted late Wednesday, came after CVS and
confirmed plans to merge in a $21 billion stock deal.
CVS gave back 20 cents, or 0.7%, to close at $28.86. Caremark slumped by 67 cents, or 1.4%, to $47.50.
beat fourth-quarter targets and guided higher for fiscal 2007. The Franklin Lakes, N.J., medical-technology shop made $175 million, or 69 cents a share, for the fourth quarter ended Sept. 30, up from the year-ago $122 million, or 47 cents a share.
Excluding certain items, earnings rose to 85 cents a share from 76 cents a year earlier. Revenue climbed to $1.49 billion from $1.38 billion a year ago. Analysts surveyed by Thomson Financial were looking for an 84-cent profit on sales of $1.48 billion. Becton Dickinson was higher by $1.57, or 2.3%, to close at $70.38.
said third-quarter earnings nearly tripled from a year ago as day rates improved, although revenue came up shy of Wall Street's expectations.
The Houston-based drilling services company made $56 million, or 92 cents a share, for the quarter ended Sept. 30, up from the year-ago $19 million, or 31 cents a share. Revenue rose to $242 million from $141 million a year earlier. Todco gained $1.23, or 3.8%, to $33.88.
Away from earnings, the benchmark 10-year note was down 7/32 in price to yield 4.59%. The dollar was slumping against the world's other major currencies. Gold futures were up $8.50 to finish at $627.80, and crude oil futures dropped 83 cents to end at $57.88 a barrel.
Overseas, Europe's equities were mostly lower. London's FTSE 100 was unchanged at 6149, and Frankfurt's Xetra DAX fell by 1.1% to 6223. Asia's shares were mixed, with Tokyo's Nikkei ending down 0.2% to 16,350, and Hong Kong's Hang Seng closing up 1.4% at 18,714.