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NEW YORK: Wall Street squeaked into positive territory on Thursday, as investors fretted that the corporate earnings season will trample on signs of recovery from the severe recession.
The Dow Jones Industrial Average edged up 4.76 points (0.06 per cent) to finish at 8,183.17. The tech-heavy Nasdaq composite gained 5.38 points (0.31 per cent) to 1,752.55 and the broad-market Standard & Poor's 500 index climbed 3.12 points (0.35 per cent) to 882.68.
After opening higher, stocks spent most of the session in the red in choppy trading as investors braced for the earnings season.
"There has been a sharp increase in investor pessimism in recent days," said Scott Marcouiller of Wells Fargo Advisors.
Stocks had an early boost when Alcoa reported after the closing bell on Wednesday a second-quarter net loss less severe than market expectations.
"With Wall Street nearly shaking in its boots ahead of a new round of corporate earnings, Alcoa Inc.'s better-than-expected quarterly report came as a breath of fresh air," said Joseph Hargett of Schaeffer's Investment Research.
Shares in Alcoa, the first Dow member to report second-quarter results, dropped 2.43 per cent to 9.23 dollars after opening more than 4.0 per cent higher.
On the macroeconomic front, new claims for US unemployment benefits fell 8.4 per cent in the past week to a six-month low, but the number was skewed by fewer-than-expected layoffs in the automotive sector, the Labour Department said.
Initial claims, it added, fell to a seasonally adjusted 565,000 in the week ended July 4, shortened by the Independence Day holiday. The data also showed those claiming jobless insurance benefits rose to an all-time high of 6.883 million in the prior week.
"Strength in financials was offset by weakness in defensive sectors, such as health care and consumer staples," Charles Schwab & Co. analysts said after the market close.
Merck was the Dow's biggest decliner, plunging 3.67 per cent to 27.01 dollars, after signing an exclusive deal with Portola Pharmaceuticals to develop an anticoagulant. Merck is to pay Portola up to 470 million dollars.
Rival drug manufacturer Pfizer fell 2.19 per cent to 14.29 dollars and healthcare products giant Johnson & Johnson slipped 0.68 per cent to 56.69 dollars.
Banking shares advanced, with the S&P banking index posting a 1.43 per cent gain. Goldman Sachs vaulted 3.36 per cent to 143.21 dollars after a recommendation by Bank of America analysts.
Citigroup rose 2.67 per cent to 2.69 dollars. The bank announced a management shake-up, notably naming John Gerspach as chief financial officer, the third person in the job this year.
ConocoPhillips leapt 2.21 per cent to 40.31 dollars after signing a deal with Abu Dhabi National Oil Company to develop the emirate's Shah Gas Field.
Sprint soared 3.96 per cent to 4.46 dollars. The telecom announced a seven-year deal with Ericcson for the Swedish company to run its wireless and wireline network for between 4.5-5.0 billion dollars.
Bonds retreated sharply on Thursday. The yield on the 10-year US Treasury bond jumped to 3.413 per cent from 3.289 per cent on Wednesday while that on the 30-year bond advanced to 4.318 per cent from 4.164 per cent. Bond yields and prices move in opposite directions. - AFP/de
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