Policy: Economy

US stocks edge lower in afternoon trading

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Photo - FILE - This Jan. 4, 2010 file photo shows an entrance to a Wall Street subway station in New York. European and some Asian stock markets rallied Thursday June 19, 2014 after the Fed signaled that U.S. interest rates would remain at record lows.   (AP Photo/Mark Lennihan, File)
FILE - This Jan. 4, 2010 file photo shows an entrance to a Wall Street subway station in New York. European and some Asian stock markets rallied Thursday June 19, 2014 after the Fed signaled that U.S. interest rates would remain at record lows. (AP Photo/Mark Lennihan, File)
News,Business,Economy

Stocks pared some of their losses late Thursday afternoon, but remained on track to close lower for the first time in five days. A batch of disappointing quarterly corporate earnings and company forecasts weighed on stocks for much of the day, with Coach and Pier 1 Imports among the biggest decliners.

KEEPING SCORE: The Standard & Poor's 500 index was flat at 1,956 as of 3 p.m. Eastern Time. The Dow Jones industrial average shed 10 points, or 0.1 percent, to 16,896. The Nasdaq composite slid nine points, or 0.2 percent, to 4,353.

RECORD TERRITORY: The S&P 500 index hit a record high close Wednesday, it's second in less than two weeks. The index is up 5.9 percent this year. The latest rally came after the Federal Reserve said it sees improvement in the U.S. job market and signs of modest inflation. The Fed said it intends to keep short-term interest rates low.

HIGHER FROM HERE?: The string of record highs has the S&P 500 index running ahead of its 50-day moving average. That suggests it could be in for more of a pullback, said Jim Russell, senior equity strategist at U.S. Bank Wealth Management. Russell still expects the market to move higher in coming months.

"We think the environment is still favorable for equities to have an upward bias," Russell said. "It's still too early to put the bear suit on."

JOBLESS AID: Fewer Americans sought unemployment benefits last week, evidence of a stronger job market as fewer workers lose their jobs. The Labor Department said Thursday that weekly applications for unemployment fell to a seasonally adjusted 312,000, the lowest in more than six years.

ECONOMIC BAROMETER: The Conference Board said Thursday that its index of leading indicators increased 0.5 percent last month, an improvement from a revised 0.3 percent gain in April. The latest reading provides further evidence that the U.S. economy is gaining strength after a harsh winter.

THE QUOTE: Applications for unemployment aid last week came in lower than expected, but were still above 300,000, signaling the recovery remains sluggish, said Chris Gaffney, a senior market strategist at EverBank Wealth Management.

"The U.S. economy is definitely still recovering, not at the pace that anyone would like, and the labor market is recovering, but slower than everyone would like," Gaffney said. "So it's still kind of a slow, boring market right now."

SECTOR WATCH: Five of the 10 sectors in the S&P 500 index rose, led by utilities. The sector is up 14.7 percent this year as investors have piled into stocks that pay high dividends. Financial and technology stocks notched the steepest decline.

BIG DIPPER: Coach led the decline among S&P 500 stocks. The luxury goods maker dropped $3.84, or 9.8 percent, to $36.35.

DRUGSTORE WOES: Rite Aid reported its fiscal first-quarter earnings sank 55 percent due to higher-than-expected drug costs and other expenses. The stock fell 30 cents, or 3.9 percent, to $7.15.

UNCOMFORTING RESULTS: Pier 1 Imports tumbled 13.1 percent after the furniture retailer's quarterly profit fell short of Wall Street expectations. Pier 1 also lowered its full-year forecast. The stock fell $2.39 to $15.87.

SUPER MARKETS: Kroger jumped 5.4 percent after the nation's biggest supermarket chain reported higher profit and raised its earnings forecast for the year. Kroger rose $2.55 to $49.81.

OUSTED: American Apparel vaulted 7.5 percent on news that the clothing chain's board ousted founder Dov Charney as chairman and moved to fire him as CEO, citing an "ongoing investigation into alleged misconduct." The stock rose 5 cents to 69 cents.

BOND MONITOR: The yield on the 10-year Treasury note rose to 2.62 percent from 2.59 percent late Wednesday.

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