Stocks recovered from their earlier losses to close flat in thin trading Thursday, but several disappointing global economic reports that pointed to further signs of slowing kept a damper on gains.
The Dow Jones Industrial Average gained 18.97 points, or 0.14 percent, to close at 13,596.93. The blue-chip index was down nearly 75 points at session low and crossed zero 27 times during the trading session.
Alcoa led the laggards, while Kraft edged higher.
The S&P 500 erased 0.79 points, or 0.05 percent, to finish at 1,460.26. The Nasdaq slid 6.66 points, or 0.21 percent, to end at 3,175.96.
The CBOE Volatility Index, widely considered the best gauge of fear in the market, climbed above 14.
Among the key S&P sectors, industrials and financials were lower, while consumer staples held small gains. (Read More: What to Expect on Quadruple Witching Day)
Investors also seemed to take a pause after major indexes hit multi-year highs in the previous session, propelled by the Federal Reserve's decision to launch another round of quantitative easing to prop up the sluggish economy.
“[The Fed] creates a floor in the equity markets,” said Matt Lloyd, chief investment strategist at Advisors Asset Management, explaining why stocks were off their lows. “There’s still upside for equities and we’re climbing a wall of worry right now.”
UBS downgraded Morgan Stanley , Goldman Sachs and Citigroup to "neutral" from "buy."
Meanwhile, Bank of America is planning to slash 16,000 jobs by year end as it speeds up a company-wide cost-cutting initiative, according to a report from the Wall Street Journal.
Green Mountain Coffee Roasters dropped after Starbucks unveiled its own line of single-serve coffees and electric brewers.
Among earnings, ConAgra Foods rallied after the packaged-food maker reported higher-than-expected earningsand boosted its full-year forecast.
Bed Bath & Beyond slumped after the home-merchandise retailer missed earnings expectations and posted same-store sales growth that slowed. At least two brokerages cut their price targets on the firm.
IHS plunged nearly 20 percent after the global consulting and analytics company missed earnings expectations and slashed its full-year earnings and revenue outlook.
Oracle is scheduled to report after the closing bell.
Norfolk Southern tumbled after the railroad company lowered its third-quarter earnings outlook, hurt by weaker shipments of coal and merchandise as well as lower fuel-surcharge revenue. At least two brokerages lowered their price targets on the firm.
On the IPO front, Trulia surged more than 40 percent in its market debut on the NYSE. The IPO raised $102 million.
Capital Bank Financial , National Bank Holdings , Spirit Realty Capital and Susser Petroleum also debuted today.
Weekly jobless claims edged down last week to a seasonally adjusted 382,000, according to the Labor Department. But the four-week moving average logged its fifth-straight weekly increase, hitting the highest level since June.
Leading indicators dipped in August, according to the Conference Board, signaling weak economic growth ahead. And factory activity in the U.S. mid-Atlantic region contracted for the fifth-straight month in September, according to the Philadelphia Federal Reserve Bank.
Also adding to woes, manufacturing logged its weakest quarter in three years, according to financial information firm Markit's U.S. "flash" manufacturing PMI index.
Overseas, manufacturing in China contracted for an 11th-straight month in September, according to a private sector survey of factory managers.
“China is one of the best places to be right now,” said Lloyd, despite the latest disappointing economic report and signs of slowdown in the world's second-largest economy. “It’s going to have a good run for the next year or two…when you look at the Shanghai exchange, it’s current trading at a 45-percent discount to historic P/E multiples and with all the accommodative measures and stimulus coming, there’s potential for a big increase.” (Read More: China’s a ‘Roach Motel’; Don’t Trust the Data—Chanos)
European shares ended lowerafter disappointing results from business activity surveys in the euro zone.
—By CNBC’s JeeYeon Park (Follow JeeYeon on Twitter: @JeeYeonParkCNBC)
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