Stocks finished mixed Thursday, following tepid retail sales reports and a legal defeat for a pharmaceuticals stalwart. Increases in Treasury yields and commodity prices stoked inflation fears before the government's March employment report, but investors were turning toward an upbeat outlook for first-quarter earnings, says Standard & Poor's MarketScope.
The Dow Jones industrial average slipped 23.05 points, or 0.21%, to 11,216.5, despite gains by 3M (MMM) on higher first-quarter earnings guidance. The broader Standard & Poor's 500 index was down 2.52 points, or 0.19%, to 1,309.04. The tech-heavy Nasdaq composite edged higher 1.42 points, or 0.06%, to 2,361.17.
Market players braced for Friday's labor report and its potential impact on interest rates. March nonfarm payrolls are expected to rise 210,000, continuing recent strong employment trends, says Action Economics. Treasury Secretary John Snow said Wednesday the report will show "good numbers."
The economic docket Friday also holds reports on wholesale trade and consumer credit for February. On Thursday, jobless claims for the week ended Apr. 1 unexpectedly sank 5,000 to 299,000, from a downwardly revised 304,000 the week before.
An array of corporate news was in focus Thursday. Merck (MRK) was lower in afternoon trading after a New Jersey jury ruled the drugmaker must pay at least $4.5 million to a 77-year-old man who claimed its painkiller Vioxx caused his heart attack.
Retailers posted disappointing March sales. Abercrombie & Fitch (ANF), Bombay (BBA), Gap (GPS), Limited Brands (LTD) and Sharper Image (SHRP) were among retailers missing forecasts.
Retail giant Wal-Mart (WMT) was lower despite posting 1.4% higher March same-store sales, beating expectations. Costco (COST) also beat expectations with a 7% rise in same-store sales. Shares were higher.
Also in retail, Bed Bath & Beyond (BBBY) was higher on a fiscal fourth-quarter profit of 67 cents a share, above the 65 cents analysts expected. Prudential upgraded the home-furnishings chain from neutral to overweight, while Deutsche Bank raised its earnings forecast.
Computer maker Apple (AAPL) was higher after climbing 9.9% Thursday on the launch of software allowing Intel (INTC)-based Macs to run the Microsoft (MSFT) Windows operating system. Separately, Bear Stearns said it sees good probability of higher-than-expected iPod unit sales for the March quarter.
In deal news, Boston Scientific (BSX) rose after the medical-device maker entered an agreement with regulators to resolve antitrust issues related to its purchase of rival Guidant (GDT).
Elsewhere, Rayovac-battery maker Spectrum Brands (SPC) was sharply lower after reducing its second-quarter forecast, citing ongoing challenges in its battery business.
In the energy markets Thursday, May West Texas Intermediate crude oil futures closed up 87 cents at $67.94 a barrel. Rising gasoline prices drove crude higher, says Action Economics.
European markets finished modestly higher. In London, the Financial Times-Stock Exchange 100 index edged higher 1.6 points, or 0.03%, to 6,045.7. Germany's DAX index added 2.19 points, or 0.04%, to 6,031.39. In Paris, the CAC 40 index was up 1.33 points, or 0.03%, to 5,222.36.
Asian markets finished higher. Japan's Nikkei 225 index rose 245.35 points, or 1.42%, to 17,489.33. In Hong Kong, the Hang Seng index rallied 311.04 points, or 1.93%, to 16,411.13. Korea's Kospi index gained 8.97 points, or 0.59%, to 1,397.
Treasury yields rose on speculation of a strong March employment report, says S&P MarketScope. Prices for 10-year Treasury notes were lower at 96-31/32 with a yield of 4.89%, while 30-year bonds fell to 92-28/32 for a yield of 4.96%.