Updated from 4:02 p.m. EST

Stocks closed mostly higher Thursday on mixed economic data as traders looked ahead to the government's February employment report Friday morning.

The Dow Jones Industrial Average closed down 5.11 points to 10,588.00. The blue-chip index has now closed lower in 11 of the 15 sessions since it hit a 32-month high on Feb. 11.

The S&P 500 added almost 4 points, or 0.3%, to 1154.87, 3 points shy of the 23-month high it touched last month. The Nasdaq led the day, closing up 21.76 points, or just over 1%, to 2055.12.

Volume on the New York Stock Exchange approached 1.3 billion shares, while some 1.8 billion shares changed hands on the Nasdaq. On both markets, advancers outnumbered decliners by about 2 to 1.

After the markets closed, Intel ( INTC) narrowed its first-quarter revenue guidance to a range of $8 billion to $8.2 billion, compared with its previous forecast of $7.9 billion to $8.5 billion.

"All eyes are on tomorrow's job report," said Barry Ritholtz, a chief market strategist at the Maxim Group. "It's probably the most awaited report we've seen in many months. It's going to have a very significant impact on trading going forward."

Ritholtz noted that expectations for tomorrow's nonfarm payrolls report are unusually ambiguous. "Even the economists that typically move in a little bit of a herd are just all over the map with this," he said. "The range is just ridiculous; some of the pessimists are saying 75,000 and others are saying 225,000, while I've even heard 250,000." The consensus forecast is for 125,000 jobs, after a 112,000 gain in January.

Regardless of February's employment results, Richard T. Williams, an equity strategist with Summit Analytic Partners, believes a significant correction in the markets will inevitably occur sometime in the next few weeks. He pointed out that a strong February employment report from the government Friday may not boost stocks, because it could be seen as a factor in prompting the Federal Reserve to raise interest rates sooner than expected.

"Now we're starting to get to the point where good news isn't good anymore and bad news may start meaning more, and that kind of change of tone is something that I've found correlates very well with corrections," Williams said. "Good employment numbers could mean higher rates will come sooner rather than later. Higher rates are a very real risk, and a higher dollar is a very real risk. If the dollar goes against U.S. companies, that has to be a negative, and it could be a powerful negative."

Overseas, London's FTSE climbed 0.7% to 4559, while Germany's Xetra DAX was up 1.5% to 4134. In Asia, Japan's Nikkei closed 0.4% higher at 11,402, and the Hang Seng in Hong Kong was flat at 13,452. The European Central Bank waved off political pressure to cut borrowing costs and left interest rates at 2% -- the lowest level in most euro-zone countries since World War II.

Meanwhile, the dollar posted gains on the euro. Recently, the euro was buying $1.2192 in New York, compared with $1.2201 on Wednesday. The dollar was higher against the yen, recently buying 111.06 yen in New York, compared with 110.04 at Wednesday's close. The 10-year Treasury note added 8/32 to yield 4.02%, while crude oil and gold prices were both higher.

On the economic front, initial unemployment claims for the week ended Feb. 28 fell to 345,000, as economists had expected, while business productivity was revised slightly lower to an annualized rate of 2.6% in the fourth quarter, from 2.7% in the previous estimate.

Factory orders fell 0.5% in January, meeting forecasts. December's 1.1% increase was revised upward to 1.8%.

On Friday, the government will report its February employment report at 8:30 a.m. EST. According to consensus estimates, nonfarm payrolls are expected to have added 125,000 new jobs compared to January's 112,000; average hourly earnings are expected to have increased 0.2% compared to January's 0.1% growth; and the unemployment rate is expected to stay flat at 5.6%.

Also, January's producer price index, postponed for release by the Labor Department on Feb. 19, is expected out at an unspecified time on Friday. This measure of the change in prices paid to domestic producers of commodities is expected to rise 0.4%, compared to December's 0.3% growth.

The day's biggest corporate story is the removal of Michael Eisner as Disney's ( DIS) chairman. The embattled Eisner will retain the chief executive position following the withholding of 43% of shares voted at the company's annual meeting for his continuation at the top of the entertainment conglomerate.

Rumors swirled that Citigroup ( C) may acquire Deutsche Bank ( DB). Deutsche Bank was recently up 7% to $93.82.

Retailers reported same-store sales in February that either matched or beat forecasts, after a surprisingly strong January.

Among the most notable was Wal-Mart ( WMT), which reported a better-than-expected 6.2% increase for the month and predicted March comps would rise 4% to 6%. Target ( TGT) reported a 7.5% rise, while Federated Department Stores ( FD) said same-store sales were up 9%.

Elsewhere, Best Buy ( BBY) said fourth-quarter same-store sales soared 9.7% and said earnings per share would come in toward the high end of its $1.34 to $1.39 range.

Ann Taylor ( ANN) reported a 13.5% jump in February same-store sales and raised its earnings estimate to a range of 47 cents to 49 cents a share in the first quarter, up from 45 cents to 47 cents.

Martha Stewart Living ( MSO) reported an unexpectedly strong fourth quarter, boosted by guaranteed royalty payments received under a contract with Kmart ( KMRT). The company earned 9 cents a share in the quarter, compared with a loss of 4 cents a year earlier. But the company's publishing segment continued to see deterioration as advertisers are spooked by Martha Stewart's legal problems, and it forecast a wider-than-expected loss in the fourth quarter.

Staples ( SPLS) reported record fourth-quarter earnings on Thursday and said it would pay its first-ever dividend. The Boston-based office-supply giant had a profit of $211.9 million, or 42 cents a share, vs. $164.6 million, or 35 cents a share, in the year-ago period. The consensus estimate of analysts was 41 cents a share, according to Thomson One Analytics. It will pay an annual cash dividend of 20 cents a share on May 17 to owners of its common stock of record on April 26.

No major earnings announcements are expected on Friday.