The Wall St. street sign is photographed in front of the American flag hanging on the New York Stock Exchange prior to a NYC Central Labor Council rally for worker protections, Thursday, Sept. 25, 2008 in New York. (AP Photo/Mary Altaffer)
NEW YORK – Wall Street struggled to find direction Thursday after three straight days of declines, with investors reacting calmly to a larger-than-expected jump in unemployment claims and news that Wal-Mart Stores Inc. is cutting its full-year outlook
Stocks fluctuated throughout the session, but the intense volatility that has dominated trading was easing for the time being; investors were likely just pausing while they tried to determine their next move. A streak of bad corporate and economic news has sent prices falling sharply this week, including a 410-point slide in the Dow Jones industrials on Wednesday.
The market seemed little affected by the Labor Department's report that the number of newly laid-off individuals seeking unemployment benefits jumped last week to a level not seen since just after the Sept. 11, 2001, terrorist attacks.
And there were more signs of a severe pullback in consumer spending that pummeled stocks earlier in the week. Wal-Mart trimmed expectations for full-year earnings. And Intel Corp. late Wednesday cut more than $1 billion from its sales forecast, providing more evidence that few industries are safe from a clampdown on spending by businesses as well as consumers.
After the week's litany of bad news, which also included disappointing reports from Macy's Inc. and Starbucks Corp., investors were likely coming to terms with the fact that the economy is in for a protracted downturn. And some investors were clearly wading cautiously back in to the market, lured by bargains.
"We're really in a holding pattern right now, trying to figure out what we need to do," said Ryan Larson, head of equity trading at Voyageur Asset Management. "You're going to see a flat market, which is a good sign considering all the bad news in the past few days."
Still, no one believe that the market has seen the last of the turbulence of recent months. Many analysts have predicted that trading will remain volatile as Wall Street tries to recover from the devastating selling during October.
In midday trading, the Dow fell 25.41, or 0.31 percent, to 8,257.25 after shuttling between gains and losses.
The Standard & Poor's 500 index fell 1.02, or 0.12 percent, to 851.28, and the Nasdaq composite index shed 17.62, or 1.18 percent, to 1,481.59.
The stock market has lost about $1 trillion over the past three days, according to the Dow Jones Wilshire 5000 index, which reflects the value of nearly all U.S. stocks. And the S&P 500 and Nasdaq are approaching levels that are half their values of October 2007, when both peaked before turning lower; the S&P's peak, a record close, was 1,565.15, while the Nasdaq reached 2,859.12 before turning lower. The Dow, which had a record high close of 14,164.53, has further to fall before it approaches a loss of 50 percent.
Government bond prices were slightly lower. The three-month Treasury bill's yield rose to 0.14 percent from 0.13 percent late Wednesday, and the yield on the benchmark 10-year Treasury note rose to 3.76 percent from 3.67 percent late Wednesday. Higher yields indicate lower demand.
In corporate news, struggling casino operator Las Vegas Sands Corp. will lay off as many as 11,000 workers after a cash crunch forced the company to halt construction on multibillion dollar projects.
Shares rose 32 cents, or 6.3 percent, to $5.42.
Wal-Mart shares fell 61 cents to $51.97 after it reported a 10 percent increase in third-quarter profit. The company cut its profit outlook because of the troubled global economy and the renewed strength of the dollar.
Meanwhile, Intel dipped 14 cents to $13.37 on concerns that consumers are shying away from big purchases, such as computers. Sales have been sluggish for a number of computer makers and their suppliers during the past earnings period.
Investors also kept their eye on the nation's automakers after President-elect Obama will likely push Congress to approve a bailout of the struggling industry. There are also reports that Obama will move to appoint a czar or board to oversee the companies. Ford fell 6 cents, or 3.3 percent, to $1.78, GM dropped 14 cents, or 4.6 percent, to $2.94.
A barrel of light, sweet crude fell 8 cents to $56.08 a barrel on the New York Mercantile Exchange.
Declining issues outpaced advancers by a 5-to-3 basis on the New York Stock Exchange, where volume came to 334.5 million shares.
The Russell 2000 index of smaller companies fell 0.75, or 0.17 percent, to 452.05.
The dollar was mixed against other major currencies. Gold prices fell.
Overseas, Japan's Nikkei closed down 5.25 percent and Hong Kong Hang Seng fell 5.15 percent. In European trading, London's FTSE 100 was down 0.31 percent, Germany's DAX rose 0.62 percent, and France's CAC-40 added 1.10 percent.