Updated from 4:04 p.m. EST
Stocks stayed volatile Thursday, falling sharply as mixed economic news disappointed investors and declining oil prices whacked the energy sector.
After rising 89 points on Wednesday, the
Dow Jones Industrial Average
finished down 101.97 points, or 0.93%, to 10,851.98, with
losing 3.7%. The
fell 11.62 points, or 0.91%, to 1270.84. The
skidded 28.99 points, or 1.25%, at 2281.57.
"Today goes to show that the market needed a catalyst to get it going," said James Park, managing director with Rodman & Renshaw. "Volume on the sell side has been high. Everything is normal and not rapid, which is a good sign, but the numbers speak for themselves. When you combine everything we dealt with today, it makes sense we're at these levels."
About 1.90 billion shares changed hands on the
New York Stock Exchange
, with decliners beating advancers by a 3-to-1 margin. Volume on the Nasdaq was 2.25 billion, with decliners outpacing advancers 2 to 1.
The 10-year Treasury bond down 1/32 in price to yield 4.56%, while the dollar was higher against the yen and flat with the euro.
Oil extended a decline, losing $1.88 to $64.68 a barrel after plunging $1.32 on Wednesday. Natural gas was down 37 cents to $8.35 per million British thermal units after weekly inventory numbers from the Energy Department showed a drawdown of 88 billion cubic feet, in line with expectations.
With oil tanking, the energy sector took it on the chin. The Amex Oil index lost 1.8%, and the Philadelphia Stock Exchange Oil Service Sector index gave back 1%. The Amex Natural Gas index fell 1.7%.
On the economic front, the Labor Department said fourth-quarter productivity fell 0.6%, compared with expectations of a 1.0% gain. It was the first decline since 2001's first quarter. Unit labor costs, which the
watches closely, rose 3.5%.
To view Gregg Greenberg's video take of today's market, click here
"U.S. worker productivity declined while unit labor costs accelerated, increasing speculation that that rising wages and benefits could fuel future inflation," said Paul Mendelsohn, chief investment strategist with Windham Financial. "This report may concern the Fed inflation hawks, while tomorrow's release of the nonfarm payrolls report for January may provide additional evidence as to the economy's overall strength."
Separately, the Labor Department said initial jobless claims fell by 11,000 to 273,000 last week. The less volatile four-week moving average fell 4,750 to 284,250, the lowest level in more than five years.
"We had a mixed bag of economic data and earnings data which has sunk us," said Peter Cardillo, chief market analyst with S.W. Bach & Co. "The market is nervous today ahead of important non-farm payroll data tomorrow, not to mention we haven't alleviated any of our geopolitical concerns."
On Wednesday, blue chips finished strong as
5% run-up overshadowed earnings travails at
. The Dow Jones Industrial Average gained 0.8% to 10,954, while the Nasdaq Composite added 0.2% to 2311.
reported a profit from continuing operations of $807 million, or 39 cents a share, on revenue of $9.71 billion for its first quarter. Analysts were forecasting earnings of 38 cents a share on sales of $9.81 billion.
For the second quarter, the conglomerate sees earnings of 40 cents to 42 cents a share, short of the 47-cent analyst consensus. But the shortfall should be made up in the full year, when Tyco expects to earn $1.85 to $1.92 a share, compared with estimates for $1.88 a share. Tyco slid $1.30, or 5%, to close at $24.80.
said net income fell to $133 million, or 6 cents a share, in the fourth quarter, down 69% from a year ago. Revenue rose slightly to $5.7 billion from last year. Analysts expected EPS of 15 cents on revenue of $5.7 billion.
In addition, Comcast's board of directors said it has authorized a $5 billion addition to the cable giant's existing stock repurchase program. Comcast also forecast 2006 revenue growth of 9% to 10%. Comcast fell 97 cents, or 3.5%, to $27.02.
Royal Dutch Shell
earned $4.37 billion in the fourth quarter, down slightly from a year ago due to the impact of hurricanes Katrina and Rita. Sales fell 2% to $92.8 billion. The stock was off $1.10, or 1.6%, to finish at $66.19.
said fourth-quarter earnings rose 59% from a year ago to $159 million, or 70 cents a share, while adjusted earnings of 71 cents a share were a nickel ahead of estimates. Quarterly revenue was slightly soft. Shares of Starwood lost $1.45, or 2.4%, to $59.60.
French telecom-gear maker
said fourth-quarter earnings rose to $414 million, or 30 cents a share, beating estimates by 2 cents. Alcatel posted 8% revenue growth and forecast a good first quarter. Alcatel was higher by 38 cents, or 2.8%, to close at $14.03.
Thursday was retail sales day on Wall Street, with most department store and specialty chains reporting January results. A handful of teen stores reported better-than-expected same-store sales Wednesday night, including
The world's largest retailer,
, said same-store sales rose 4.7% in January, compared with a 2.2% gain in December. January had the largest monthly gain since May 2004. Shares tacked on 14 cents, or 0.3%, to $46.28.
said same-store sales for January rose 5.2%, higher than expectations. The stock dipped 49 cents, or 0.9% to $55.23.
said its earnings were $174.2 million, or 22 cents a share, in its first quarter. Adjusted earnings of 24 cents a share were 4 cents ahead of estimates.
Starbucks raised its full-year earnings target to 68 cents to 70 cents a share from its previous range of 63 cents to 65 cents. Both estimates include about 9 cents a share in stock-compensation expenses. Analysts, on average, expect earnings of 66 cents a share, including the 9 cents in option costs. Starbucks surged $3.04, or 9.7%, to $34.40.
posted fourth-quarter net income of $406.4 million, or 48 cents a share, up from $255.1 million, or 30 cents a share, a year earlier. Sales rose 9% to $9.7 billion from last year. The Thomson First Call consensus was for earnings of 40 cents a share. CVS added 93 cents, or 3.4%, to $28.71.
After the close,
said it had fourth-quarter earnings of $199 million, or 47 cents a share, falling from $347 million, or 82 cents, a year ago. Revenue rose to $2.98 billion from $2.54 billion last year. Analysts expected earnings of 21 cents a share on revenue of $3.08 billion, according to Thomson First Call.
Amazon finished the session down $1.24, or 2.8%, to $42.74. After the earnings report was released in the after-hours session, the stock plummeted 12%.
On Friday, earnings reports are expected from
Overseas stocks were mostly lower. In Europe, London's FTSE 100 was recently off 0.9% to 5747, Germany's Xetra DAX eased 1.3% to 5649. In Asia, Japan's Nikkei rose 1.4% overnight to 16,711 while Hong Kong's Hang Seng fell 0.3% to 15,692.