Stocks extended their losses into a second day Thursday after a cautious outlook from home builder Toll Brothers and a surge in energy prices.
Toll Brothers said fourth-quarter profit rose 72 percent, but it lowered expectations for next year.
Without much news to guide the market, Wall Street drifted this week after a November rally in which major indicators rose to four-year highs. Recent signs that the economy is faring better than expected renewed fears about inflation and rising interest rates, although some traders still expect a final run-up in stock prices by year-end.
The Dow Jones industrial average fell 55.79, or 0.52 percent, to 10,755.12.
Broader stock indicators were also lower. The Standard & Poor's 500-stock index fell 1.53, or 0.12 percent, to 1255.84, and the Nasdaq composite index fell 5.55, or 0.25 percent, to 2246.46.
Colder weather in the Northeast and Midwest drove expectations for greater heating fuel demand, although weekly inventory reports have indicated that U.S. oil and gas reserves continue to expand. On the New York Mercantile Exchange, natural gas surged $1.29, to $14.99 per 1,000 cubic feet, as a barrel of light crude rose $1.45, to $60.66.
Bond prices reversed Wednesday's decline, with the yield on the 10-year Treasury note falling to 4.45 percent from 4.52 percent late Wednesday. The dollar was mixed against other major currencies in European trading, while gold prices remained near record highs.
The only economic report of the day came from the Labor Department, which said the number of unemployment claims rose 6,000, to 327,000, last week, although 8,000 of those were hurricane-related. Economists were expecting claims to drop to 318,000.
General Motors fell $1.04, to $22.
Texas Instruments fell 93 cents, to $32.63
Intel fell 45 cents, to $25.70.
Xilinx fell 46 cents, to $26.02
Costco Wholesale fell $1.06, to $48.29.
McDonald's fell 44 cents, to $34.82.
New York Stock Exchange composite index rose 12.16, to 7743.43.
American Stock Exchange index rose 7.63, to 1757.55.
Russell 2000 index of smaller-company stocks rose 1.49, to 685.22.
NYSE: 2.24 billion shares, up from 2.13 billion on Wednesday. Advancers outnumbered decliners 9 to 7.
Nasdaq: 1.93 billion shares, up from 1.76 billion. Advancers narrowly outnumbered decliners.
Crude oil for January delivery: $60.66, up $1.45.
Gold for current delivery: $519.30 a troy ounce, up from $514.30 on Wednesday.