The Dow industrials wobbled Thursday as a rise in jobless claims rattled a few cages ahead of tomorrow's jobs report and ExxonMobil's $10.9 billion quarterly profit was -- wait for it -- a disappointment.
The Nasdaq moved solidly higher, however, as big-name tech stocks continued to draw interest.
Exxon Mobil, the biggest drag on the Dow, reported its net income rose 17 percentto $10.9 billion, or $2.03 per share, up from $9.3 billion, or $1.62 per share, a year ago. But analysts had expected that, given record oil prices, the company would surpass its own record of an $11.7 billion profit earned in the fourth quarter of 2007. The culprit, it seems, was margins at the company's refining operations. Record prices of refined products such as gasoline, while a menace to consumers, failed to keep pace with the rapid increase in crude prices.
Crude oil dropped below $113 a barrel, while gold fell close to a three-month low of $862.30 as the dollar hit a one month high against the euro.
After theFederal Reserve failed to provide much indication about whether it is done cutting rates on Wednesday, the market turned to the latest economic numbers for direction on the economy.
The Institute for Supply Management said its index of U.S. manufacturing activity held steady at 48.6 in April, though it remained below 50, which indicates contraction. Prices paid increased. A separate report from the Commerce Department showed construction spending dropped 1.1 percent in March after a 0.4 percent increase in February.
Initial jobless claims rose by 35,000, more than expected, last week and the number of workers remaining on jobless benefits hit a four-year high. However, the four-week moving average of new claims fell to 363,750 from a revised 370,250, the Labor Department reported.
Personal spending in March rose 0.4 percent, twice as much as expected, the Commerce Department reported. Income climbed 0.3 percent, just below the 0.4 percent expected. The Fed's favorite inflation gauge, personal consumption expenditures excluding food and energy, rose 0.2 percent, better than the 0.1 percent expected.
Later in the morning, reports are expected on manufacturing activity and construction spending.
Starbucks said after the bell Wednesday that it would likely earn less this year than the year before.
Shares of Adobe Systems rose after the maker of Photoshop and Flash software maker said it expects quarterly revenue to come at the high end of its expected range and backed its projection of 13 percent revenue growthfor the full year ahead of its annual meeting later today.
Among other notable gainers in tech land were Google, Apple, Yahoo and Research In Motion.
Meanwhile, Microsoft's board met, but failed to come to a consensus about what to do concerning its bid for Yahoo. The software giant could make a hostile bid, sweeten its offer or just walk away altogether, the Wall Street Journal reported.
In other earnings news, Burger King Holdings, the second largest fast-food chain, posted a gain in quarterly profit that amounted to 30 cents per share, ahead of the analysts estimate of 27 cents a share.
Home Depot shares rose after the home-improvement retailer announced plans to close 15 underperforming U.S. stores and put a lid on opening future stores for a while. Home Depot said it expects a charge of about $586 million related to this move. Even excluding this charge, Home Depot expects a 24-percent drop in earnings for the year.
Shares of Pioneer Southwest Energy Partners, a spinoff of Pioneer Natural Resources that buys oil and gas properties in Texas and southwest New Mexico, rosein their debut on the Big Board. The stock priced at $19 after the closing bell yesterday. (Is the IPO Market Simmering Again?)
THURSDAY: Monthly auto sales; ISM manufacturing index; construction spending
FRIDAY: April jobs report; factory orders; earnings from Chevron, Viacom
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