Updated from 4:10 p.m. EST
Bulls' run at a second straight rally lost steam Thursday and the averages ended mixed amid weakness in the semiconductor and energy sectors.
Dow Jones Industrial Average
finished up 24.73 points, or 0.23%, to 10,883.35, while the
lost 1.87 points, or 0.15%, to 1263.78. The
shed 11.11 points, or 0.49%, to 2255.87.
The Dow was up as much as 93 points around midday, fueled by strong guidance at retailer
. But after a 109-point rally on Wednesday, the momentum proved too much for buyers to sustain.
"We ran out of gas after yesterday's large advance," said Paul Nolte, director of investments with Hinsdale Associates. "We only had earnings news from a couple companies today, and that couldn't carry us."
About 1.77 billion shares changed hands on the
New York Stock Exchange
, with advancers narrowly beating decliners by a 6-to-5 margin. Volume on the Nasdaq was 2.32 billion, with decliners outpacing advancers 8 to 7.
The 10-year Treasury bond was up 2/32 in price to yield 4.54%, while the dollar weakened against the yen and the euro.
Elsewhere on the fixed-income side, the Treasury Department auctioned a new series of 30-year bonds for the first time since 2001. The government sold $14 billion of the bonds, and the issue was priced to yield 4.53%. Existing 30-year bonds, which mature in February 2031, were up 15/32 and yielding 4.64%. Prices and yields move inversely.
Oil ended a two-day slide that lopped $2.50 off the front-month contract. March crude closed up 7 cents at $62.62 a barrel, after hitting a session high of $63.70. Natural gas futures fell to a six-month low.
On the economic front, the Labor Department said that initial jobless claims for the week ended Feb. 4 rose by 4,000 to 277,000, below analysts' estimates. The less-volatile four-week average dropped to 276,500, the lowest level since April 2000.
Elsewhere, the Commerce Department said that U.S. wholesale inventories rose 1% in December. Economists had expected a 0.4% increase.
"Internally, the market's bounce left something to be desired," said Marc Pado, a strategist with Cantor Fitzgerald. "Since the market went out on the high of the day yesterday, it should have some morning momentum left. The real question is whether or not it can be sustained without any major earnings-, economic- or oil-moving news."
Chicago Fed President Michael H. Moskow gave his assessment of the U.S. economy to the Chicago Chapter of the Risk Management Association on Thursday, stating that "if inflation or inflation expectations were to rise persistently, then policy clearly would have to be tightened further. Of course, other events could transpire that result in prospects for inflation and growth that would be consistent with a less-firm policy stance."
Moskow also said that "even with the funds rate in the range of neutral, further changes in policy may be appropriate. My view is that inflation will likely remain contained."
By sector, the Philadelphia Oil Service Sector index was down 2.9%, the Amex Oil index was lower by 1.9%, and the Philadelphia Semiconductor Sector Index lost 0.3%. The S&P Retail index tacked on 0.1% and the Amex Airline index gained 0.8%
Before the bell, Best Buy raised fourth-quarter earnings guidance for the second time since early January, saying it now expects to earn $1.25 to $1.30 in the period ending Feb. 25. The outlook, which is up from previous guidance of $1.06 to $1.16 a share, lifted the stock $4.13, or 8.5%, to close at $52.96.
To view Gregg Greenberg's video take on today's market, click here
said fourth-quarter earnings rose 41% from last year to $423 million, or $1.42 a share, reflecting enrollment gains. Adjusted for items, Aetna earned $1.26 a share in the quarter, 3 cents better than expected. The company sees 2006 earnings of $5.42 to $5.48 a share, compared with the $5.46-a-share consensus. Aetna finished up $3.15, or 3.3%, to $99.27.
fourth-quarter earnings rose 25% to $237 million, or $1.07 a share, beating estimates by 9 cents. The company guided first-quarter earnings as much as 8 cents above the consensus. The stock added $1.53, or 2.3%, to $67.64.
said first-quarter earnings rose 26% from last year to $58.3 million, or 40 cents a share. The results were a penny shy of estimates despite a $10 million sales beat. Whole Foods dropped $6.78, or 9.4%, to $65.27.
earned $694 million, or 21 cents a share, in its second quarter, up from $386 million, or 13 cents a share, a year ago. The latest quarter profit beat Wall Street estimates by a penny. Shares slipped by 27 cents, or 1.6%, to finish at $16.49.
swung to a fourth-quarter loss of $57 million, or 12 cents a share, compared with a profit of $82 million, or 17 cents a share, a year ago. Results included a charge of $129 million, or 27 cents a share, related to the repatriation of foreign earnings. Excluding charges, the company earned $72 million, or 15 cents a share, beating the Thomson First Call consensus by a penny. Revenue rose 2% to $4.49 billion from last year, just below expectations.
Looking ahead, the company forecasted earnings of $1.27 to $1.32 a share for fiscal 2006, bracketing the current Thomson First Call average estimate of $1.29 a share. Coca-Cola was higher by 64 cents, or 3.3%, to $20.10.
American International Group
is expected for formalize an agreement Thursday under which it will pay $1.6 billion to settle government accounting allegations. It's one of the biggest corporate settlements ever. AIG rose 74 cents, or 1.1%, to $67.12.
Research In Motion
has found a workaround plan to continue the wireless email service should the ongoing patent dispute with
continue. The news sent shares of RIM higher by 97 cents, or 1.4%, to close at $69.62.
XM Satellite Radio
finished 4.8% higher after the company announced it had signed a programming deal with Oprah Winfrey's Harpo Radio to create a new channel, titled "Oprah & Friends." The new channel is set to debut in September. XM gained $1.17 to $25.78.
Overseas markets were higher, with London's FTSE 100 up 1.5% to 5809, while Germany's Xetra DAX was adding 1.4% to 5743. In Asia, Japan's Nikkei rose 1% overnight to 16,440, and Hong Kong's Hang Seng added 0.3% to 15,413. The strength comes a day after U.S. stocks staged their best session in a week, with the Dow, S&P and Nasdaq each adding about 1%.