Stocks Finish Mixed; March Jobs Report Looms

NEW YORK (TheStreet) -- Stocks finished on a mixed note on Thursday as Wall Street balanced expectations for a positive jobs report on Friday against concerns about Spain's soaring borrowing costs.

The Dow lost nearly 15 points, or 0.1%, to finish at 13,060. The blue-chip index ranged from 13,012 to 13,088 during the session. The S&P 500 closed down less than a point at 1398.

The Nasdaq, however, bucked the selling and rose 12 points, or 0.4%, to settle at 3080.

The major U.S. equity indices traded within a narrow range through most of the trading session, which comes ahead of a long holiday weekend as the exchanges will be closed tomorrow for Good Friday. For the week, the Dow was down 1.2%, the S&P 500 dipped 0.7%, and the Nasdaq fell 0.4%, kicking off the calendar second quarter on a negative note.

The biggest selling came on Wednesday as Wall Street digested a clear signal from the Federal Reserve on Tuesday that more quantitative easing was far from a done deal. The minutes of the most recent meeting of the Federal Open Market Committee indicated support for more asset purchases was scant unless the economy takes a turn for the worse. That news drove the dollar higher and sparked selling in gold and oil.

Early Thursday, the action in the broad market mirrored a sell-off in risk assets during the European session as yields on Spanish 10-year bonds rose another 12 basis points to 5.81%. The yields reached a pinnacle for the year and raced past levels seen when the European Central Bank installed the first leg of its long-term refinancing program on Dec. 21 by more than 50 basis points.

The tepid demand for Spanish debt was a reminder that the country could be next in line for a bailout as global investors showed they were not yet prepared to hold the country's bonds without a higher risk premium.

With the Spanish economy slipping further into the doldrums, Madrid has cautioned that the country's debt-to-gross domestic product ratio could soar to 79.8% in 2012 from 68.5% last year. The country is already dealing with widespread joblessness with the unemployment rate above 20% and will likely face further obstacles to growth with the government's severe budget cuts.

"Stress has returned to the periphery of the Euro area. Since the beginning of March, Spanish bond yields have risen by 80 basis points," J.P. Morgan analyst David Mackie wrote in a report. "The Spanish government has made a number of missteps in recent weeks which have raised questions about its credibility, and it is this that is making investors reluctant to purchase Spanish debt."

London's FTSE edged up 0.4%, reclaiming positive territory as the session closed. Germany's DAX retreated 0.1%, paring losses. In Asia, Japan's Nikkei Average fell 0.5% and Hong Kong's Hang Seng index closed lower by almost 1%.

In the U.S., a solid jobless claims report provided some support for the markets. Weekly initial jobless claims came in at 357,000, the lowest level in four years. While the number was slightly higher than a consensus estimate of 355,000, it was a decline from the prior week's revised figure of 363,000 and brought the four-week moving average down by 4,250 to 361,750. Continuing claims for the week ended March 24 fell 16,000 to a seasonally adjusted 3.34 million.

Earlier Thursday, global outplacement firm Challenger, Gray & Christmas said U.S. employers announced sharply fewer job cuts in March compared with the previous year. The firm said layoffs announced by U.S.-based employers totaled 37,880 for the month, 27% below the 51,728 job cuts announced in February and a 9% decline from last year when 41,528 planned layoffs were recorded. It was also the lowest monthly layoff tally since 37,135 job cuts were announced last May.

The positive data arrives ahead of the all-important March jobs report from the Labor Department on Friday. Investors will be hoping for a fourth straight month of 200,000-plus jobs growth. The current average estimate of economists surveyed by Thomson Reuters sits at 203,000.

Breadth within the Dow was negative with 19 of the index's 30 components finishing in the negative territory. The leading percentage losers among the blue-chips were Alcoa ( AA), AT&T ( T), Verizon ( VZ) and General Electric ( GE).

Home Depot ( HD) was a bright spot, gaining 1.5%. Other Dow gainers included American Express ( AXP), McDonalds ( MCD), Microsoft ( MSFT) and Wal-Mart ( WMT).

Tech behemoth Apple ( AAPL) set another all-time high after Jefferies analyst Peter Misek raised his price target to $800, citing the likelihood of the tech giant introducing an Apple TV set in the fourth quarter of this year. The stock rose 1.5% to close at $633.68 after running as high as $634.66 to eclipse a previous peak of $632.21.

A number of other analysts have raised their Apple price targets in recent days, including Topeka Capital's Brian White, who Tuesday put a $1,001 price target on the stock, the highest on Wall Street; and Piper Jaffray's Gene Munster, who said the company could be the first to garner a trillion-dollar market cap on Wednesday and put his target at $910.

In corporate news, Constellation Brands ( STZ) was among the biggest losers within the S&P 500, falling nearly 13% after delivering a disappointing full-year earnings outlook.

Bed Bath & Beyond ( BBBY), the specialty retailer, easily topped Wall Street's fourth-quarter earnings expectations. Bed Bath & Beyond reported earnings of $351 million, or $1.48 a share, for the three months ended Feb. 25. Sales rose 9.1% to $2.73 billion. Same-store sales rose 6.8% in the quarter. Shares soared 8.5% to close at $71.85.

Shares of Polycom ( PLCM) plunged nearly 20% to $14.56 after the Pleasanton, Calif.-based company reported its preliminary first-quarter results after the market close on Wednesday, predicting revenue between $364 million and $370 million. In January, Polycom had forecast sales around $399 million.

May oil futures rose $1.84 to settle at $103.31 a barrel. In other commodities, June gold futures rebounded by $16 to settle at $1,630 an ounce as bargain hunting lifted the yellow metal off three-month lows.

The benchmark 10-year Treasury was adding 14/32, pushing the yield down to 2.18%, while the U.S. dollar index was up 0.4% to $80.08.

-- Written by Andrea Tse and Shanthi Bharatwaj in New York.

More from Markets

Dow Logs Eighth Straight Drop as Stocks Slump

Dow Logs Eighth Straight Drop as Stocks Slump

This Is What's Hot Thursday - Stocks Slide, Intel's CEO Woes & Major Movers

This Is What's Hot Thursday - Stocks Slide, Intel's CEO Woes & Major Movers

U.S. Banks Pass Fed 'Stress Test' With Room for Dividends, Buybacks

U.S. Banks Pass Fed 'Stress Test' With Room for Dividends, Buybacks

U.S. Drillers at Mercy of Iran, Saudi Production Spat as OPEC Meeting Begins

U.S. Drillers at Mercy of Iran, Saudi Production Spat as OPEC Meeting Begins

Comcast's Brian Roberts vs. Disney's Bob Iger: Which Titan Will Nab Fox?

Comcast's Brian Roberts vs. Disney's Bob Iger: Which Titan Will Nab Fox?