Stocks finished lower Thursday, as investors assessed homebuilder earnings news and a Federal Reserve official's speech on the economy. Data on wholesale trade did little to remove uncertainty over whether the economy is headed for a hard or soft landing, says Standard & Poor's Equity Research.
The Dow Jones industrial average fell 74.76 points, or 0.66%, to 11,331.44. The broader Standard & Poor's 500 dropped 6.24 points, or 0.48%, to 1,294.02. The tech-heavy Nasdaq composite shed 12.55 points, or 0.58%, to 2,155.29, despite gains by Apple (AAPL).
San Francisco Fed President Janet Yellen said inflation was outside of the Fed's comfort zone. "The inflation outlook remains highly uncertain," Yellen told a Boise (Idaho) audience. Her tone was relatively balanced overall, says Action Economics.
The slowing housing market was also in focus Thursday. KB Home (KBH) and Beazer Homes (BZH) each cut their full-year earnings guidance, pointing to rising cancellation rates. Shares of KB Homes gained, while Beazer Homes shares dipped.
On the upside, Hovnanian Enterprises (HOV) was higher after the homebuilder reported a 34% drop in profit for its fiscal third quarter.
Elsewhere, Advanced Micro Devices (AMD) was modestly higher despite declining initially. ATI Technologies (ATYT), which the chipmaker is buying, posted fourth-quarter sales that fell below Street expectations.
Photographic giant Eastman Kodak (EK) was modestly lower after inking a multi-year contract with Wal-Mart (WMT) to install 2,000 picture kiosks in 1,000 stores nationwide. Financial terms of the deal were not disclosed.
Shares of Palm (PALM) slid after the handheld device maker guided its third-quarter revenue lower, citing declining retail shipments of its Treo smart phones.
In analyst calls, Martek Biosciences (MATK) was down sharply as Citigroup downgraded the shares from buy to hold following unexpectedly low third-quarter earnings guidance.
On the economic front, jobless claims fell 9,000 to 310,000 in the week ended Sept. 2, after an upwardly revised 319,000 the week before. The numbers indicate continued strength in the job market, says Action Economics. Separately, wholesale sales rose 0.4% in July, slightly below expectations.
Cleveland Fed President Sandra Pianalto tops a light economic calendar Friday. Pianalto is set to speak on inflation, (a voter) highlights Friday amid an otherwise light calendar. Of interest, she speaks on inflation, the boogy man for central bankers.
In the energy markets, October West Texas Intermediate crude oil futures closed down 15 cents at $67.35 a barrel after weekly inventory data showing an unexpected rise in gasoline supplies.
European markets finished lower. In London, the Financial Times-Stock Exchange 100 index fell 71.2 points, or 1.2%, to 5,858.1. Germany's DAX index lost 39.34 points, or 0.68%, to 5,773.72. In Paris, the CAC 40 index was down 55.43 points, or 1.08%, to 5,060.09.
Asian markets ended lower. Japan's Nikkei 225 index dropped 271.68 points, or 1.67%, to 16,012.41. In Hong Kong, the Hang Seng index slid 162.07 points, or 0.94%, to 17,096.44. Korea's Kospi index declined 5.84 points, or 0.43%, to 1,351.17.
Treasury yields ticked lower amid the soft wholesale trade data. The 10-year note edged up in price to 100-22/32 for a yield of 4.79%, while the 30-year bond fell to 93-08/32 for a yield of 4.94%.