Stocks Close Mixed After Rocky Session

Stocks closed mixed Thursday after shaving deeper losses from earlier in the day in the last half hour of trading as investors considered a mixed batch of earnings and the Fed's next steps to stimulate the economy.

The Dow Jones Industrial Average fell 12.33 points, or 0.1 percent, to close at 11,113.95. The dow fell more than 70 points earlier in the session, a day after closing lowerfollowing news the Federal Reserve may not provide as much stimulus to the economy as had been expected.

3M, Caterpillar and Cisco fell, while Pfizer and Walt Disney rose.

The S&P 500 Index rose 1.33 points, or 0.1 percent, to close at 1,183.78, while the Nasdaq rose 4.11 points, or 0.2 percent, to close at 2,507.37. The CBOE Volatility Index, widely considered the best gauge of fear in the market, rose above 20.

More of the key S&P sectors were higher, led by health care, telecom and consumer discretionary. Industrials fell.

Traders have expected stocks to largely hold steady ahead of the Fed's policy setting meeting next week.

Market participants had been expecting the Fed to buy anywhere from $500 billion to $1 trillion in long-term assets, in a strategy known as quantitative easing. But there has been much speculation over the past two weeks on the size and scope of the Fed's plans.

Meanwhile, if the Fed decides to buy fewer than $500 billion, stocks would be likely to sell off, said Marc Pado, market strategist at Cantor Fitzgerald.

"The dollar would rally, and that would reverse what we’ve seen here lately," he said.

Not even a falling dollar could provide support for the market on Thursday, however. The dollar fell against a basket of currencies, after rising the past two days following a note from Goldman Sachs that said the currency will need to drop by "a lot more" than the Fed thinks in order to meet the central bank's inflation target. Meanwhile, gold rose above $1,330 an ounce.

A spate of earnings Thursday morning delivered mixed news to the markets. However, with about half of S&P 500 companies reporting so far, 85 percent have matched or beaten estimates, according to Thomson Reuters.

3M sank more than 6 percent afterthe multinational conglomerate released a disappointing outlook, despite reporting results that beat expectations.

Halliburton shares fell nearly 8 percent after a report indicating the energy services firm knew the cement mixture used to seal the ill-fated BPwell was unstable.

Shares of Dow component ExxonMobil rose after the energy giant reported strong profits, but revenues that fell short of expectations. Earlier, Royal Dutch Shell beat analyst forecasts with an 18 percent jump in third-quarter profit, sending the oil giant's shares higher.

Meanwhile, the price of oil closed above $82 a barrel, giving a boost to Chevron, although ConocoPhillips slipped. Chevron is expected to report earnings Friday morning.

Shares of Dow Chemical fell even after the largest U.S. chemical maker posted a better-than-expected quarterly profit helped by strong sales of chlorine, basic plastic, and lubricants.

On the tech front, Motorolaadvanced after the mobile-phone maker, which plans to split into two companies next year, posted an operating profit of $3 million, versus a loss of $183 million a year ago, thanks to sales of smartphones based on Google's Android software.

Research In Motion slid after Oppenheimer cut the stock to "perform" from "outperform," citing increasing competition for the maker of smartphones.

Meanwhile, Symantec climbed after the software maker reported a profit above forecasts Wednesday, helped by newly acquired businesses. In addition, several brokerages raised their price targets on the company.

Akamai Technologies rose after several brokerages raised their price targets on the computer software company. Akamai reported a 21 percent jump in profits on Wednesday. Flextronics soared more than 10 percent after reporting strong sales growth and fewer charges.

However, Teradyne dropped more than 7 percent after the semiconductor testing equipment maker delivered a weak forecast for the current quarter.

Tech giant Microsoft shares rose ahead of reporting earnings after-the-bell Thursday.

Visa shares declined as the credit-card issuer's results beat expectations Wednesday, but not as much as investors had hoped. Investors were also concerned about new regulations affecting debt cards. S&P Equity cut its rating for Visa to "buy" from "strong buy," and a couple brokerages also lowered their price target for the company. Shares of rival MasterCard also fell.

AutoNation's third-quarter earnings missed expectations, and the auto retailer projected future auto sales will continue to be slow.

General Motors, meanwhile, said it would repay $2.1 billion to the U.S. government by buying back preferred shares after its initial public offering in November. GM also said it reached a deal for a $5 billion credit facility.

EastmanKodak surged to the top of the S&P 500 after beating forecasts on earnings from the licensing of its technology to phone and camera makers.

And casino stocks got a boost after Las Vegas Sands posted a better-than-expected profit due to strong results at its new Singapore resort and in Macau. Rivals MGM Resort and Wynn Resorts also rose.

Shares of Skechers plunged after reporting disappointing third quarter earnings, including news of a 70 percent rise in inventory. Susquehanna cut the shoe retailer's price target to $23 from $27, and lowered its rating to to "neutral." Wedbush also cut Skechers to "neutral" from "outperform."

Allstate tumbled more than 5 percent after the life insurer reported earnings that fell short of expectations.

And on the financial front, Wells Fargo was criticized for how it handled foreclosures, and said it will re-file documents on 55,000 cases.

In merger and acquisition news, Sanofi-Aventis said it would not raise its $18.5 billion hostile bid for Genzyme , after posting better-than-expected quarterly earnings.

Meanwhile, Sanofi-Aventis hasn't stood still. The drugmaker announced it is buying BMP Sunstonefor $10 a share, sending shares of the Pennsylvania company skyrocketing.

Volume on the consolidated tape of the New York stock Exchange was 4.2 billion shares. On the NYSE floor, 1 billion shares changed hands, with advancers slightly leading decliners.

Meanwhile, the government auctioned $29 billion of 7-year notes, which had a yield of 1.970 percent and a bid-to-cover ratio of 3.06.

In the day's economic news, initial claims for state unemployment benefits fell 21,000 to 434,000, the lowest level since early July, according to the Labor Department.

This Week:
THURSDAY: After-the-bell earnings from Microsoft and MetLife.
FRIDAY: GDP, employment cost index, Chicago PMI, consumer sentiment, farm prices; before-the-bell earnings from Chevron, Merck and Cigna.

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