Stocks recovered from earlier losses to finish mixed Wednesday. The major indexes were able to bounce off session lows as shares in blue chips McDonald's (MCD) and Wal-Mart (WMT) gained ground. Tech issues ended with modest loses.
The week has been relatively quiet as investors have been hedging their bets ahead of Friday's jobs update.
On Wednesday, the Dow Jones industrial average finished up 1.63 points, or 0.02%, to 10,593.11. The broader Standard & Poor's 500-stock index added 1.93 points, to 0.17%, to 1,151.03.
The tech-heavy Nasdaq composite index fell 6.29 points, or 0.31%, to 2,033.36, amid weakness from Intel (INTC) ahead of its mid-quarter update due after Thursday's close.
In economic news Wednesday, the Institue for Supply Management's non-manufacturing index for February fell to 60.8 from 65.7 in January. The headline figure was weaker than the consensus forecast of around 63.0. Also discouraging to investors: the employment component of the report fell to 52.7, vs. 53.4.
Economic research group Informa Global Markets notes that the report's employment index -- which covers the largest segment of the U.S. labor market -- does not confirm the strength seen nearly everywhere else for jobs in February.
"Most components [of the ISM services index] dipped," notes UBS economist Maury Harris. "The level of the index was still high enough to signal quite strong growth."
The Federal Reserve unveiled its Beige Book, an anecdotal report on economic conditions across the U.S. According to the report, the economy continued to expand in January and February (through Feb. 23). Employment is rising slowly in most regions, with wages up a bit, and health care costs rising at a considerably faster pace. Meanwhile, consumer prices were level or up slightly. The report contains no real surprises, notes Informa, though employment growth and rising consumer prices are worth noting.
Employment remains Wall Street top concern, with traders' attention focused on Friday's release of the February employment report. Economists on average expect the report to show the unemployment rate unchanged at 5.6%, with 135,000 new jobs added during the month.
More details from the Walt Disney (DIS) shareholders meeting that began Wednesday will be available Thursday. As of Wednesday's close, some 43% of votes tallied were for removing embattled chairman and CEO, Michael Eisner.
In tech news, Seagate Technology (STX), maker of hard disk drives, said that lackluster sales to businesses and laptop makers would cut into its already reduced earnings guidance.
Retailers were in focus Wednesday. Dow component Wal-Mart (WMT) raised its annual dividend by 44% to 52 cents a share.
No. 2 toy retailer Toys R Us (TOY) said quarterly profit slid on falling video game sales and charges related to closing its Kids R Us and Imaginarium stores.
Costco Wholesale(COST) posted quarterly profit as southern California shoppers turned to its stores to avoid labor disputes at competing grocery stores.
The earnings calendar this week is relatively light.
Earnings updates due Thursday include Kellwood Co. (KWD), Mandalay Resort Group (MBG), Martha Stewart Living Omnimedia (MSO), Pep Boys (PBY), Staples (SPLS), and TiVo (TIVO).
Economic data Thursday will include initial jobless claims for the previous week, January factory orders, and February chain store sales.
After a brief rise following the ISM services report early in the session, Treasuries declined in price amid a turnaround in the U.S. dollar and rising expectations for resuming job growth. Economic strength is expected to fuel the labor market and may cause the Fed to raise rates to curb inflation. Traders are eagerly awaiting Friday's employment report.
European stock markets finished down Wednesday following the gains of Tuesday's session. Losses in the U.S. markets seemed to weigh. The London's Financial Times-Stock Exchange 100 index shed 15 points, or 0.33%, to 4.525.10.
Germany's DAX index dipped 28.64 points, or 0.70%, to 4,071.70. In Paris, the CAC 40 lost 26.85 points, or 0.71%, to 3,758.51.
In Asia, markets lost ground. The Nikkei 225 index fell 9.59 points, or 0.08%, to 11,351.92. In Hong Kong, the Hang Seng index lost 277.26 points, or 2.02%, to 13,454.09.