U.S. equity markets fell overnight after a gauge of the services sector fell in April, dampening cheer that came with better-than-forecast data on the labor market.
By the close the Dow Jones had eased 62 points to 13,207, while the NASDAQ was sold off 36 points to 3024.
The Institute for Supply Management said its index of non-manufacturing activity dropped to 53.5 last month from 56 in March. Any reading above 50 indicates expansion, but the reading paled in comparison to the expected reading of 55.4.
The ISM's survey covers all sectors outside of manufacturing, including retail, construction, financial services, health care, and hotels.
The US Labour Department said initial jobless claims for the week that ended April 28 totaled 365,000, much lower than the forecast 375,000. The latest numbers compared to the revised figure of 392,000 in the prior week.
For Friday, economists are expecting employers to have added 160,000 jobs to payrolls in April, with the unemployment rate remaining steady at 8.2%.
A weak report on private-sector hiring from payroll processor ADP came out on Wednesday. Thursday morning, Challenger, Gray & Christmas reported that job cuts rose to 40,559 in April -- an increase of 7% from March, and 11% higher than a year ago.
In corporate news, General Motors (NYSE:GM) reported fiscal first-quarter earnings dropped sharply due to a loss in Europe and a hefty goodwill impairment charge.
Net earnings attributable to common stakeholders fell to $1 billion, or 60 cents per share, for the period that ended March 31. This compared with the $3.2 billion, or $1.77 per share, recorded a year-ago.
The latest results included a one-time goodwill impairment cost, which ate into profits by 33 cents per share. In the first quarter of 2011, GM’s earnings included a net gain from special items worth $1.5 billion, or 82 cents a share.
Analysts had expected earnings of 85 cents a share for the latest period.
After the closing bell on Thursday, insurer AIG (NYSE:AIG) and social media company Linkedin (NASDAQ:LNKD) are due to report results. AIG is forecast to report a drop in earnings to $1.12 per share, while Linkedin is expected to earn 9 cents per share.
Major U.S. retailers Thursday reported sales for the month of April that showed a slowdown in spending as cooler weather, an early Easter and renewed worries about the economy dampened enthusiasm.
Although some clothing retailers posted better-than-expected sales in April, big names such as Costco Wholesale Corp. (NASDAQ:COST) and Target (NYSE:TGT) posted gains that were smaller than Wall Street expected.
Amongst the department stores, Macy's (NYSE:M) said April same-store sales rose 1.2 percent, missing Wall Street estimates of 1.9 percent growth according to a survey of analysts by Thomson Reuters.
Online reviews site Yelp (NASDAQ:YELP) dropped after the company reported a net loss of $9.8 million, or 31 cents per share, for the first quarter of 2012 -- its first as a publicly traded company. Yelp is in the process of investing in international expansion.
Sara Lee Corp. (NYSE:SLE) said fiscal third-quarter earnings plunged by 70.1% on Thursday, which prompted the food company to lower its full-year 2012 earnings guidance.
Viacom (NASDAQ:VIA), the owner of Paramount Pictures, MTV and Comedy Central, Thursday reported an increase of 56% in its second-quarter earnings on higher pay TV fees, while movie earnings slowed revenue growth.
On the NYMEX, crude futures for June delivery lost $2.55, or 2.4%, to $102.66 a barrel while gold for June delivery was off $19.20, or 1.2%, at $1,634.80 an ounce.
The European Central Bank held interest rates steady, even as the eurozone economy slides toward recession. ECB president Mario Draghi appeared to hint that there could be rate cuts in the future.
European stocks finished mixed following Draghi's comments with the FTSE 100 (UKX) ticked up 0.2%, the DAX (DAX) in Germany slipped 0.2% and France's CAC 40 (CAC40) lost 0.1%.
Proactive Investors is a market leader in the investment news space, providing ASX “Small and Mid-cap” company news, research reports, StockTube videos and One2One Investor Forums.