MARKET SNAPSHOT: U.S. Stocks Turn Lower After Jobless Claims, Earnings

By Anora Mahmudova and Sara Sjolin, MarketWatch

Alcoa, Bed Bath & Beyond shares drop after earnings results

NEW YORK (MarketWatch) -- U.S. stocks edged lower on Thursday as investors assessed weekly jobless claims and mixed earnings reports from Alcoa, Bed Bath & Beyond and other companies.

The number of Americans filing for initial unemployment benefits (http://www.marketwatch.com/story/us-jobless-claims-jump-14000-to-281000-2015-04-09) rose by less than expected, while the rate of layoffs remained historically low. Meanwhile, wholesale inventories edged up, as sales fell, in a sign that demand over the winter slowed down.

Market participants were gearing up for more earnings reports, after aluminum giant Alcoa unofficially kicked off the first-quarter U.S. earnings season on a downbeat note (http://www.marketwatch.com/story/alcoa-swings-to-profit-but-revenue-misses-2015-04-08).

The S&P 500 (SPX) fell 4 points, or 0.2%, to 2,077.93, with seven of its 10 main sectors trading lower. Utilities and telecoms led the losses, while energy and materials sector stocks held on to gains.

The Dow Jones Industrial Average (DJI) inched 45 points, or 0.3%, lower to 17,858.05.

The Nasdaq Composite (RIXF) dropped 14 points, or 0.3%, to 4,936.55.

Mike Baele, senior portfolio manager at Private Client Reserve at U.S. Bank Wealth Management, said the lack of alternative investments are still supporting equities.

"Earnings estimates came down and valuations are on a high side, but we still think that equities are attractive relative to other assets," said Baele.

"In the next few weeks, investors will pay a lot of attention to forward guidance from companies as they beat the lowered threshold," he said, warning that outside risks, such as Europe's currency problems and conflict involving Russia and Ukraine, pose bigger risks than domestic growth.

FOMC reaction: Investors were still digesting the minutes from the latest FOMC meeting, released on Wednesday, which showed several members supported a June rate hike (http://www.marketwatch.com/story/low-bar-set-for-fed-rate-hike-minutes-show-2015-04-08), but also that others thought a rate hike wouldn't be warranted until later in the year, as low oil prices and the strong dollar would likely hold inflation down. U.S. stock markets ended the Wednesday session slightly higher after the minutes (http://www.marketwatch.com/storyno-meta-for-guid).

"What has been taken as dovish FOMC minutes didn't really shed any new light on the path for interest rates. June has looked unlikely for a while now, and any month beyond that will depend on the data," said Craig Erlam, senior market analyst at forex broker Oanda, in emailed comments.

Data: The number of people who applied for U.S. unemployment benefits climbed by 14,000 to 281,000 in the seven days from March 29 to April 4, but the low level of initial claims shows that few workers are getting laid off even as job creation appears to have slowed.

Stocks to watch: Shares of Alcoa Inc.(AA) lost 4.9% after the aluminum maker late Wednesday reported revenue that missed forecasts (http://www.marketwatch.com/story/alcoa-swings-to-profit-but-revenue-misses-2015-04-08) and pointed to a challenging outlook.

Zynga Inc.(ZNGA) tanked 14% after the video-game maker late Wednesday said chief executive Don Mattrick will leave the company effective April 8 (http://www.marketwatch.com/story/zynga-ceo-don-mattrick-to-leave-company-founder-mark-pincus-to-be-ceo-2015-04-08-16911119), to be replaced by founder and chairman Mark Pincus.

U.S.-listed shares of Novogen Ltd. (NVGN) surged 25% to $5.65 after the Australian biotech company said its experimental drug Anisina was shown to kill melanoma cells.

Bed Bath & Beyond Inc.(BBBY) fell 5.8% after the retailer on Wednesday reported fourth-quarter earnings in line with forecasts.

Shares of Walgreens Boots Alliance Inc.(WBA) gained 2.5% after the drugstore chain reported profit ahead of expectations (http://www.marketwatch.com/story/walgreens-stock-rises-after-profit-beats-expectations-2015-04-09).

For more on today's notable movers, read Movers & Shakers column. (http://www.marketwatch.com/story/constellation-brands-walgreens-alcoa-in-focus-2015-04-08)

Other markets: Asian stock markets closed mostly higher (http://www.marketwatch.com/storyno-meta-for-guid), powered by a 2.7% jump for the Hang Seng Index . Stocks in Europe followed suit, with the Stoxx Europe 600 index on track to log an all-time closing high (http://www.marketwatch.com/storyno-meta-for-guid).

Oil (CLK5) rebounded (http://www.marketwatch.com/story/oil-slightly-recovering-after-previous-sessions-6-fall-2015-04-09) from Wednesday's more-than-6% slide. Metals were mixed, while the ICE dollar index (DXY) advanced.

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