US stocks erased early gains on solid earnings reports from Caterpillar and Netflix to end lower on Thursday, with some weak economic data and profit-taking seeming to drive the selling.
The Dow Jones Industrial Average closed down 22.33 points (0.18 per cent) at 12,734.63. The broad-based S&P 500 slipped 7.60 (0.57 per cent) to 1,318.45, while the tech-rich Nasdaq Composite dropped 13.03 (0.46 per cent) to 2,805.28.
A modest rise in weekly jobless claims and poor figures for new-home sales in December helped repress bullish sentiment, said Andrea Kramer of Schaeffer’s Investment Research.
The Dow blue chips got an early boost from Caterpillar, after it posted a 60 per cent rise in net income to $1.5 billion for the fourth quarter of 2011.
Cat’s stock rose more than four per cent in early trade but closed with a modest 2.2 per cent rise.
Video rental house Netflix was up 22.1 per cent after it reported late Thursday solid gains in its streaming service subscriber base.
But shares in Dow member AT&T sank 2.5 per cent after it turned in a whopping loss of $6.7 billion for the fourth quarter, mainly due to charges from its failed takeover of T-Mobile.
Staid, struggling retailer JC Penney surprised traders with a buoyant 2012 forecast, sending its shares rocketing 18.8 per cent.
United Continental Holdings, the parent of merged United and Continental airlines, jumped 6.3 per cent after reporting losses narrowed in its fourth quarter, beating analyst expectations of a worse performance.
Shares in biotech giant Amgen fell 1.6 per cent after it announced the $1.16 billion purchase of German-American cancer research firm Micromet, a deal in which it obtains Micromet’s promising leukemia therapy.
The deal was worth $11 a share for Micromet shareholders, and the share price on the Nasdaq soared $32.1 per cent to just below that level, at $10.94.
Bond prices rose. The yield on the 10-year Treasury fell to 1.93 per cent from 2.01 per cent on Wednesday, while the 30-year slid to 3.09 per cent from 3.15 per cent.
Bond prices and yields in opposite directions.