Stocks finished Thursday’s listless session mixed, as investors collected profits for a second straight day despite an unexpected drop in weekly unemployment claims.
The market was heartened by the latest Labor Department report, which showed continued strength in the nation’s labor market. First-time jobless claims fell by 5,000 to 326,000 last week. Economists had expected claims to rise slightly to 335,000.
Crude oil futures fell slightly one day after the bombings in Saudi Arabia raised new concerns about terrorism in the oil-rich Middle East. A barrel of light crude was quoted at $43.45, down 19 cents, on the New York Mercantile Exchange.
Despite the good economic news, investors sold off large-cap stocks and booked profits before the year’s end. The major indexes were nearly flat most of the session, and trading was light as many investors took time off for New Year’s.
“Most of the big money left a week ago, and all you’re seeing now is a little speculation and some tax-planning moves,” said Will Gourd, investment advisor at J.P. Morgan Private Bank. “But the economic data looks good, energy prices are stabilizing, yesterday notwithstanding, and things look good for next week when everybody comes back.”
The Dow Jones industrial average was off 28.89 points, or 0.3 percent, at the close, while the broader Standard & Poor’s 500-stock index was up a fraction of a point. The technology-rich Nasdaq composite index gained 1.34 points, or 0.1 percent.
Despite two down days earlier this week and the Dow’s losses Thursday, analysts said the market was still in good shape to further its post-election gains in January, at least until first-quarter earnings season in the middle of the month.
“I think you’ve got maybe another 3 or 4 percent (increase) to go yet in January,” said Russ Koesterich, U.S. equity strategist at State Street Corp. in Boston. “After that, you’ll see interest rates rising again and it could get tougher. But for now, we’re looking pretty good.”
In corporate news, Fannie Mae jumped 95 cents to $71.33 after it sold $5 billion in preferred stock to unnamed institutional investors, $1 billion more than expected. The gains will likely be used to offset massive losses expected as the embattled mortgage giant restates its earnings in the wake of its recent accounting scandals.
Pharmaceutical market researchers said prescriptions of Pfizer Inc.’s arthritis drug Celebrex plummeted 56 percent in the past week. The company said earlier this month the drug could carry an increased risk of heart complications when taken at high doses. Pfizer fell 25 cents to $27.01.
Boeing Co. dropped 17 cents to $51.90 despite an announcement from Continental Airlines Inc. that it would buy 10 7E7 Dreamliners, becoming the first U.S. carrier to place an order for Boeing’s newest passenger jet. Continental rose 25 cents to $13.70.
Steel stocks suffered on media reports that China could become a large-scale steel exporter, possibly creating a glut on the global market. U.S. Steel Corp. shed $2.90 to $50.04, while AK Steel Holding Corp. slid $1.95 to $13.89 and Oregon Steel Mills Inc. tumbled $2.33 to $19.34.
Alcoa Inc. lost 44 cents to $31.45 as Lehman Brothers analysts cut their profit estimates for fourth quarter and 2005, citing high raw materials costs and the plummeting U.S. dollar.
Microsoft Corp. said it will no longer market its Passport identification service, in which customers could store passwords and credit card information for online shopping. The move came after online auctioneer eBay Inc. said it would no longer recognize Passport, once a lynchpin of Microsoft’s online strategy. Microsoft slipped 14 cents to $26.76.
Overseas, Japan’s Nikkei stock average climbed 0.94 percent. In Europe, Britain’s FTSE 100 closed up 0.01 percent, France’s CAC-40 rose 0.02 percent for the session, and Germany’s DAX index gained 0.2 percent.