Wall St retreats from record highs on mixed data

By Angela Moon

NEW YORK (Reuters) - U.S. stocks fell on Thursday, a day after the Dow and the S&P 500 indexes closed at record highs as investors digested a mixed bag of economic reports.

The three major U.S. stock indexes extended losses to hit session lows following a batch of data that sent mixed signals on the economy - the number of Americans filing new claims for unemployment benefits rose last week to the highest in nearly nine months and home resales fell to the lowest in nearly a year, while the Philadelphia Federal Reserve Bank's index of factory activity rose slightly in December.

 

"The market is adjusting after the rally yesterday. It's been a strong year, and I wouldn't be surprised if investors closed out their year today or tomorrow since there isn't much room or news to move higher from here until next year," said Doug Foreman, co-chief investment officer of Kayne Anderson Rudnick Investment Management.

The Fed's decision Wednesday to trim its monthly bond purchases by $10 billion to $75 billion beginning in January was accompanied by a dovish indication of rock-bottom interest rates for the foreseeable future. That combination enticed buyers and helped the Dow and the S&P 500 score their largest gains in two months.

"I was surprised by the Fed's decision and delighted with the market's response," said Jack Ablin, chief investment officer of BMO Private Bank in Chicago.

The SPDR S&P 500 exchange-traded fund trust also blew through the enormous call open interest at the 180 strike on Tuesday. The exchange-traded fund was down 0.1 percent at 181.44.

The Dow Jones industrial average dipped 0.67 of a point, or unchanged on a percentage basis, to 16,167.3. The S&P 500 slipped 2.91 points or 0.16 percent, to 1,807.74. The Nasdaq Composite dropped 14.333 points or 0.35 percent, to 4,055.732.

Facebook fell 2.5 percent to $54.17 after the social network company announced the offering of 70 million shares, including more than 41 million shares from Chief Executive Officer Mark Zuckerberg worth about $2.3 billion. Zuckerberg's sale, partly to pay a tax bill, will reduce his voting power to 56.1 percent from 58.8 percent.

Target Corp said hackers might have stolen data from some 40 million credit and debit cards of shoppers who visited its stores during the first three weeks of the holiday season in the second-largest such breach reported by a U.S. retailer.

Oracle shares jumped 4.7 percent to $36.22 a day after the No. 2 software maker's better-than-expected results and quarterly revenue outlook raised hopes that it's on track to revive growth.

Dish is considering a bid for T-Mobile US next year, according to people close to the matter, in what would be the satellite TV provider's second attempt at acquiring a major wireless operator. Dish shares rose 1.3 percent to $56.03, while T-Mobile shares shot up 6 percent to $28.89.

Darden Restaurants said it would sell or spin off its Red Lobster business, buckling under pressure from activist investor Barington Capital Group after reporting another quarter of sliding profits. Darden shares dropped 4.8 percent to $50.37.

(Editing by Jan Paschal)