Stocks traded mixed Thursday as investors remained focused on the events in the Middle East, and shrugged off largely positive economic news.
Hewlett-Packard and Bank of America led Dow decliners, while Chevron and General Electric rose.
The S&P 500 traded flat, while the tech-heavy Nasdaq gained slightly. The CBOE Volatility Index, widely considered the best gauge of fear in the market, fell to nearly 21, after two days of gains.
Among key S&P 500 sectors, industrials and health care rose, while telecom and energy fell.
Oil prices continue to rise on the political upheaval in Libya, although they eased off highs after news Saudia Arabia was in talks with Europeanrefiners to cover any shortfall caused by the Libyan's turmoil. News of a lower than expected rise in crude inventories in the U.S. gave a slight boost to prices.
There remains a concern a long period of high oil prices will thwart the economic recovery. The price of U.S. light sweet crude for April delivery was trading at about $99 a barrel, while London Brent was trading below $114 a barrel.
The price of gold, meanwhile, held steady at a seven-week high above $1,413 an ounce. The dollar fell slightly against a basket of currencies.
Despite a spate of economic news Thursday, including a surprising drop in jobless claims, traders remained focused on Libya, Todd Schoenberger, managing director at LandColt Trading told CNBC.com.
"Traders are concerned about one thing only, and that’s what’s happening in Libya.," Schoenberger said.
"People are worried, just because of that uncertainty factor, he said. "Things seem to be escalating. Where does this end? There are deep concerns there."
In earnings news, General Motors rose slightly after reporting its first full-year profit since 2004. The automaker slightly beat analyst estimates, although earnings before interest and taxes were slightly below estimates.
GM's results come at a pivotal time for investor sentiment in the auto industry, still widely seen as being in the early stage of recovery from its near-collapse in 2008 and 2009.
Also, Target rose after posting a 10.5 percent increase in profitto $1.45 a share.
Sears fell more than 5 percent after reporting profits fell in the latest quarter. and the retailer announced late Wednesday that it named the former CEO of Avaya, Lou D'Ambrosio, to lead the company after a three-year search. (Read more: Greenberg: Is the New Sears CEO a Joke?)
Shares of priceline.com , however, soared after the online travel company posted good results thanks to a surge in international bookings, and provided an optimistic outlook. At least seven brokerages raised their price targets for the company.
Also in corporate news, Toyota Motor fell slightly after news the automaker was recalling 2.17 million vehicles in the United States to fix accelerator pedals.
On the economic front, new home sales fell 12.6 percentin January to a seasonally-adjusted 284,000 from a drop of 8.8 percent to a downwardly revised 324,000 pace a month earlier. Economists surveyed by Reuters had expected sales to fall to a 310,000-unit pace last month.
Earlier, the government reportedinitial claims for unemployment fell by 22,000 to 391,000 for the week ended Feb. 19, the Labor Department reported. That's down from 413,000 a week ago. The four-week moving average of claims fell to 402,000, the lowest since mid-2008.
Meanwhile, new orders for durable goods soared 2.7 percent in January due to a boost in aircraft bookings, the Commerce Department said. The increase was in line with expectations.
The Treasury will auction $29 billion in 7-year notes at 1 p.m. and St.Louis Federal Reserve President James Bullard speaks at 8:30 a.m. on the outlook for monetary policy.
Shares in Europe fell for the fourth consecutive dayon the turmoil in Libya. The FTSEurofirst300 Index closed down 0.5 percent.
On Tap This Week:
THURSDAY: 7-year Treasury note auction, money supply; earnings after-the-bell from AIG, First Solar, Gap and Salesforce.
FRIDAY: GDP (second reading), consumer sentiment; earnings before-the-bell from JCPenney.
More From CNBC.com: