Stock market fluctuates in a tight range as EU offers vague pledge of support for Greece

Stocks trade flat as EU pledges support for Greece

NEW YORK — Stocks fluctuated in a tight range Thursday as European leaders issued a vague pledge to help Greece with its growing debt crisis.

Investors also reacted coolly to a Labor Department report that showed first-time claims for jobless benefits fell more than expected last week.

Greece’s debt problems have been spooking global markets for weeks, and hopes that a rescue was on the way helped lead stocks higher in the U.S. and Europe over the past three days.

Expectations had been building that a Thursday summit of European leaders would produce a solution for the problem, but the verbal commitment that emerged to provide unspecified help to Greece later only partly assuaged investors’ concerns.

European officials are not expected to disclose specifics of the plan until early next week.

Greece’s fiscal crisis has been undermining confidence in Europe’s shared currency, the euro, which fell again against the dollar after the anticlimactic summit in Europe.

Fiscal problems at other weak European economies including Portugal and Spain have also been weakening faith in the euro, which is shared by 16 countries but has no central fiscal authority. Runaway deficit spending in weaker states like Greece has tested the market’s faith in the euro countries to keep their budgets under control.

In late morning trading, the Dow Jones industrial average slipped 9.97, or 0.1 percent, to 10,028.41. The Standard & Poor’s 500 index fell 2.50, or 0.2 percent, to 1,065.63, while the Nasdaq composite index fell 3.29, or 0.2 percent, to 2,144.58.

Meanwhile, bond prices were mixed Thursday. The yield on the benchmark 10-year Treasury note, which moves opposite its price, rose to 3.73 percent from 3.69 percent late Wednesday.

The dollar was mixed other major currencies. It strengthened against the euro, which fell on the possibility of a bailout for Greece. Gold rose.

Crude oil fell 75 cents to $73.77 per barrel on the New York Mercantile Exchange.

The Labor Department said the number of newly laid-off workers seeking unemployment benefits fell by 43,000 to a seasonally adjusted 440,000, the lowest level in a month. Economists polled by Thomson Reuters were expecting claims to fall to 465,000.

The sharp drop came after claims rose in four of the previous five weeks. The recent increase in claims put investors on edge about whether an economic recovery would be sustainable. High unemployment is one of the biggest obstacles to a rebound.

Two other reports scheduled to be released Thursday were postponed because of two major snowstorms that have shut down the federal government in recent days. The Commerce Department will delay, at least for one day, reports on monthly retail sales and business inventories.

In corporate news, the utility company FirstEnergy said it is buying rival power provider Allegheny Energy for about $4.7 billion in stock. It will also assume about $3.8 billion in debt.

Allegheny jumped $2.21, or 10.5 percent, to $23.23, while FirstEnergy fell $2.45, or 5.9 percent, to $39.01.

Stocks fell modestly Wednesday, erasing steep early morning losses as investors became more comfortable with Federal Reserve Chairman Ben Bernanke’s plan to unwind stimulus measures the central bank launched to support the economy.

Bernanke said the Fed will likely start to tighten credit by increasing the interest rate it pays on deposits with the central bank.

The Dow ended the day down 20 points after recovering from a loss of nearly 100 points.

Five stocks fell for every four that rose on the New York Stock Exchange, where volume came to 288.6 million shares compared with 299.5 million shares traded at the same point Wednesday.

The Russell 2000 index of smaller companies fell 2.18, or 0.4 percent, to 593.64.

Overseas, Britain’s FTSE 100 rose 0.1 percent, Germany’s DAX index fell 0.9 percent, and France’s CAC-40 lost 0.8 percent. Japanese markets were closed for a national holiday.