Weak home construction data and a batch of disappointing financial results from companies such as Mattel, Yum Brands and AutoNation helped steer U.S. stocks on a downward path Thursday afternoon. Investors also had their eye on developments in Ukraine after a passenger plane was shot down over the eastern part of the country.
KEEPING SCORE: The Dow Jones industrial average fell 78 points, or 0.5 percent, to 17,060 as of 2:11 p.m. Eastern Time. The Standard & Poor's 500 index shed 13 points, or 0.7 percent, to 1,968. The Nasdaq composite slid 40 points, or 0.9 percent, to 4,385.
MIXED PICTURE: Government reports about the economy were uneven. The number of people seeking U.S. unemployment benefits fell last week, an encouraging sign about the labor market, however home construction fell in June to the slowest pace in nine months, a setback to hopes that housing will boost economic growth. Homebuilders slumped on the news. M/I Homes fell the most, sliding $1.16, or 4.9 percent, to $22.59.
"The housing starts numbers were weak, but housing has been incredibly volatile," said Randy Frederick, managing director of trading and derivatives at the Schwab Center for Financial Research. "They were definitely disappointing."
SELLING HIGH: Stocks remain near record territory. The Dow set a record high close on Wednesday, its second this month, and the S&P 500 is hovering near its July 3 all-time high. That may have encouraged investors to sell some of their stock holdings Thursday, said Darrell Cronk, deputy chief investment officer for Wells Fargo Private Bank.
"It's more of some position-squaring and a little bit of profit-taking over the next couple of days as we continue to set new highs," Cronk said.
MICROSOFT LAYOFFS: Microsoft said early Thursday it will eliminate up to 18,000 jobs over the next year as it works to integrate the Nokia business it bought in April. The company has about 127,000 employees now. Microsoft's stock added 69 cents, or 1.6 percent, to $44.77.
WRONG TURN: AutoNation's second-quarter earnings rose 12 percent, but fell short of Wall Street's expectations. The stock of the nation's largest auto dealership chain fell $4.37, or 7.2 percent, to $56.46.
TROUBLED TOYLAND: Mattel fell 7.3 percent after the toy maker reported that its income plunged 61 percent in the second quarter, weighed down by costs tied to its acquisition of Mega Brands. The stock shed $2.84 to $36.19.
NO QUIERO KFC: Yum Brands shares slid 6 percent a day after the operator of Taco Bell, Pizza hut and KFC reported higher second-quarter earnings but also sluggish sales in the U.S. at Pizza Hut and KFC chains. Yum fell $4.93 to $77.78.
MISSED THE STREET: Industrial manufacturing and engineering company Colfax reported second-quarter profit and revenue below Wall Street expectations. The stock slid $3.84, or 5.3 percent, to $68.86.
AIRLINE STOCKS SLIDE: Several airline companies declined around the time that reports surfaced about a passenger plane carrying 295 people being shot down Thursday over Ukraine. American Airlines Group fell 91 cents, or 2.1 percent, to $42.57, while Delta Air Lines slid 76 cents, or 2 percent, to $37.11. United Continental shed 94 cents, or 2.1 percent, to $43.96.
SECTOR VIEW: The 10 sectors in the S&P 500 declined, led by industrial stocks. SanDisk fell the most of the 500 stocks in the index, losing 13.1 percent after the flash memory maker issued a disappointing outlook. SanDisk fell $14.10 to $93.70. Humana bucked the trend to lead the index's risers $5.69, or 4.5 percent, to $133.12.
BONDS AND OIL: Bond prices rose. The yield on the 10-year Treasury note fell to 2.47 percent from 2.53 percent late Wednesday. Benchmark U.S. crude oil for August delivery jumped $1.87 to $103.08 a barrel in electronic trading on the New York Mercantile Exchange.