Stocks were mixed Thursday as investor enthusiasm over a sharp drop in initial unemployment claims was offset by rising oil prices and a disappointing wholesale inventories report. Technology shares benefited from a pair of outlook upgrades and strong earnings from National Semiconductor.
Investors grew more cautious through the session as oil prices climbed, topping the $44-a-barrel mark after weeks of declines.
The Commerce Department reported that wholesale inventories rose 1.3 percent in July, double what economists had expected. Wholesale sales rose by only 0.5 percent, which means that business and consumer spending has trailed off and more products are sitting in warehouses.
"We're starting to see some real evidence of softness in consumer spending," said Russ Koesterich, U.S. equity strategist for State Street Corp. in Boston. "I don't think the economy is falling off a cliff. It's chugging along at a moderate pace, but will it be enough to keep corporate profits where they need to be? That's the question."
The Dow Jones industrial average fell 24.26, or 0.2 percent, to 10,289.10. The tech-focused Nasdaq composite index rose 19.01, or 1 percent, to 1869.65, and the Standard & Poor's 500-stock index gained 2.11, or 0.2 percent, to 1118.38.
The economic data will likely weigh heavily on the Federal Reserve as it prepares to meet Sept. 21 to discuss another hike in the nation's benchmark interest rate, which currently stands at 1.5 percent.
Tech stocks, battered this summer after a series of disappointing earnings reports, were buoyed by a rare spate of good news. Nokia jumped $1.06, to $13.77, after the Finnish maker of cellular phones raised its sales and profit outlooks for the current quarter.
Shares of Texas Instruments surged $1.94, or 10.3 percent, to $20.77, on news it expected third-quarter earnings to come in above the middle of its previous estimate range.
National Semiconductor reported a 29 percent jump in sales, beating Wall Street estimates by 5 cents per share, but added that profits for the current quarter would likely fall 8 to 10 percent in comparison. Its stock rose $1.48, to $13.48.
Supermarket chain Pathmark Stores tumbled $1.32, or 18.4 percent, to $5.85, after it said it lost five cents per share in the second quarter and would likely default on some of the terms of its credit agreement in the current quarter.
Shares of Procter & Gamble slipped 64 cents, to $56.09, despite the company's confirmation that its earnings would meet analysts' target and profits would grow at least 10 percent for the current quarter.
* The New York Stock Exchange composite index rose 10.22, to 6544.31; the American Stock Exchange index rose 5.86, to 1244.89; and the Russell 2000 index of smaller-company stocks rose 8.39, to 566.18.
* Advancing issues outnumbered declining ones by 3 to 2 on the NYSE, where trading volume rose to 1.36 billion shares, from 1.25 billion on Wednesday. On the Nasdaq Stock Market, advancers outnumbered decliners by 11 to 6 and volume totaled 1.64 billion, up from 1.42 billion.
* The price of the Treasury's 10-year note fell $2.81 per $1,000 invested, and its yield rose to 4.20 percent, from 4.16 percent on Wednesday.
* The dollar rose against the Japanese yen and fell against the euro. In late New York trading, a dollar bought 109.77 yen, up from 109.25 late Wednesday, and a euro bought $1.2194, up from $1.2191.
* Light, sweet crude oil for October delivery settled at $44.61, up $1.84, on the New York Mercantile Exchange.
* Gold for current delivery fell to $398.50 a troy ounce, from $399.40 on Wednesday, on the New York Mercantile Exchange's Commodity Exchange.