NEW YORK ( TheStreet) -- Stocks pushed higher in the final hour with two of the three major indexes managing to eke out modest gains during a listless day of trading. The Dow Jones Industrial Average rose 22 points to 10,595 at the closing bell after spending much of the session in negative territory. The Nasdaq Composite inched up 2 points to 2,303. The S&P 500 ended with a less than 1-point loss at 1,125. At the close of trading 11 of the 30 Dow components were in the red, dragged by Alcoa ( AA), down 1.3%, Bank of America ( BAC), down 0.7%, Kraft Foods ( KFT), lower by 0.6%, and Pfizer ( PFE), off by 0.6%. Gainers on the index were Hewlett-Packard ( HPQ), up 2%, Cisco Systems ( CSCO), up 1.5%, Intel ( INTC), up 1.2% and
Du Pont ( DD), up 1.1%. Better-than-expected jobs data failed to cheer investors as mounting evidence points to a slow recovery ahead. The Labor Department said early Thursday that the number of people filing for initial unemployment benefits dropped by 3,000 in the week ended Sept. 11 to a seasonally adjusted 450,000. It was the lowest level of first-time claims in two months and the third decline in four weeks, indicating the jobs market may be stabilizing. The figure was expected to rise to 460,000, according to consensus estimates from Briefing.com. The Bureau of Labor Statistics also revealed that the producer price index, which measures prices of goods at the wholesale level, rose 0.4% in August, more than the projected 0.3%, on the back of rising energy costs. However, core PPI -- which measures the price of goods excluding food and beverages -- rose only 0.1%, in line with expectations. The figures helped abate concerns about deflation. "The PPI really took some of the deflation risk off the table for the short term, with energy prices rising after four months of decreases," said Linda Bakshian of Federated Investors. "Over the long term, the deflation outlook is still cautious because of low interest rates and higher deficit spending." On whether the Federal Reserve would consider another round of quantitative easing, Bakshian said the central bank would likely wait to see if economic conditions worsen before making a move. "If economic data improves, quantitative easing will not be necessary," she said. Philadelphia's Federal Reserve said that manufacturing activity in the region was flat in September, as new orders and shipments declined for the second consecutive month. The index reading improved to -0.7 from -7.7 recorded in August. Economists had expected a positive reading of 2, according to Briefing.com. A positive number indicates expansion. While the reading was only slightly below negative, it was the second straight month of negative numbers after 10 consecutive months of positive numbers. In the housing market, RealtyTrac said the number of homeowners that received initial notices of default fell 30% in August. The data should point to fewer foreclosures but the report also showed that lenders repossessed 95,000 homes last month, a record high.
Global stocks were lower Thursday , led by China's Shanghai Composite, which fell 1.8% on fears that regulators will require banks to raise more capital. Japan's Nikkei ended the day flat, as Japan continues its efforts to weaken the yen against the dollar. Hong Kong's Hang Seng ended 0.2% lower. European stocks also closed lower on Thursday after retail sales in U.K. unexpectedly fell. Germany's DAX, and the FTSE in U.K. closed 0.1% and 0.3% lower respectively.
Investors also turned cautious amid rising tensions between the U.S. and China over the valuation of the Yuan. The Treasury Department said Thursday that the U.S. current account -- which registers both trade and capital transactions -- recorded a wider deficit of $123.3 billion in the second quarter, in line with expectations. It also reported foreign net buying of $61.2 billion in U.S. stocks, bonds and financial assets in July, suggesting robust demand for U.S. assets. China remained the biggest investor in U.S. treasuries. In a congressional testimony, Treasury Secretary Timothy Geithner said that the pace of appreciation of the yuan has been too slow and the extent of appreciation too limited. The Chinese yuan hit a new high against the dollar for the fifth consecutive trading session. The yuan ended trading Thursday in Shanghai at 6.7248 per dollar, its strongest close since 1994. U.S. Secretary of Treasury Timothy Geithner criticized China's move toward a more flexible exchange rate as being "too slow." "We are very concerned about the negative impact of these policies on our economic interests, and are pursuing a carefully designed, targeted approach to address these problems," Geithner said on Capitol Hill Thursday. His remarks came in the wake of Japan's move to weaken its currency on Wednesday.
China rejected the criticism and warned that more pressure will worsen relations between the two countries. "The appreciation of the renminbi can't solve the trade deficit with China," said foreign ministry spokeswoman Jiang Yu, referring to the currency by its other official name. "Pressure cannot solve the issue. Rather, it may lead to the contrary." President Obama is set to appoint Harvard Professor Elizabeth Warren and charge her with the role of creating a new consumer protection agency, according to press reports. In corporate earnings, Oracle ( ORCL) shares gained 3.6% in after-hours trading after closing lower by 1.5%. The software maker reported first-quarter earnings of 42 cents a share after the closing bell, beating expectations for profits of 37 cents a share, as the company's software business grew "strongly" in all regions. Revenue jumped 50% to $7.6 billion, also better than expected. Results were attributed to "disciplined business management." Research In Motion ( RIMM) shares soared 8.2% in after-hours trading after closing higher by 2.1%. The Blackberry maker beat top- and bottom-line expectations in its second fiscal quarter, growing earnings by 68% to $796.7 million, or $1.46 per share. Revenue jumped 31% to $4.6 billion. FedEx ( FDX) shares fell 3.8% to close at $82.72 after the courier forecast current quarter earnings below expectations, and warned of a slow economic recovery. Even so, first-quarter profits more than doubled to $380 million, or $1.20 per share, on an uptick in business and consumer demand. The company beat top-line estimates with revenue of $9.5 billion. Boeing ( BA) said it expects to hire more than 460,000 pilots and nearly 600,000 maintenance workers over the next two decades in an effort to meet strengthening demand in the airline industry. The Dow component also forecast a need for the industry to hire as many as one million workers over the same period of time to meet growing demand. Boeing shares dipped 0.2% to close at $62.61. Microsoft ( MSFT) gained 0.9% to close at $25.33 after saying its new video game "Halo: Reach" pulled in $200 million in sales on the first day it was available. Its new full-body motion-sensing game system, Kinect, will be available Nov. 4. Oracle ( ORCL) and Research In Motion ( RIMM) are due to report earnings after the bell. Shares of Oracle closed lower by 1.5% while shares of Research In Motion gained 2.1%. Potash ( POT) rose 0.9% to close at $148.38, on a Globe and Mail report that it was trying to assemble a Chinese-led group of investors to back a leveraged buyout with senior management that would top BHP Billiton's ( BHP)bid. American depositary receipts of BHP lost 0.3% to $73.23. Ford Motor ( F) shares jumped 4.8% to $12.44 after Barclays Capital upgraded the stock to overweight. Trading of Arena Pharmaceuticals ( ARNA) shares was halted after a Food and Drug Administration panel raised concerns about the safety of its weight loss drug Locaserin , and said the drug provided only marginal weight loss for patients. Shares of GameStop ( GME) surged 4.4% to close at $19.40 after the video game retailer said it will buy back $500 million in shares and debt.
In commodity markets, crude oil for October delivery slid $1.55, to trade at $74.47 a barrel. The
December gold contract settled up $5.10 to $1,273.80 an ounce at the Comex division of the New York Mercantile Exchange. The metal hit new record highs of $1,279.50 per ounce Thursday as inflation fears once again jump-started buying of the safe-haven asset. The Energy Department said natural gas storage saw an injection of 103 billion cubic feet in the week ended Sept. 10, significantly higher than the injection of 88 billion to 92 billion cubic feet, projected by the Platts survey of analysts. October natural gas futures were gaining 8 cents to $4.081 per BTU in the afternoon. The benchmark 10-year Treasury note slid 11/32, diluting the yield to 2.763%. Meanwhile, the dollar was trading lower against a basket of currencies, with the dollar index down by 0.3%. --Written by Shanthi Venkataraman and Miriam Marcus Reimer in New York.