NEW YORK (CNN/Money) - Hewlett-Packard's worse-than-expected earnings report weighed on the Dow industrials throughout the session Wednesday, while the Nasdaq managed to recover from a bout of profit taking in the morning and finish nearly unchanged.

The Dow Jones industrial average (down 31.39 to 9397.51, Charts) clocked a loss of 0.3 percent, largely caused by the selling that plagued HP. The Standard & Poor's 500 index (down 2.05 to 1000.30, Charts) lost 0.2 percent, while the Nasdaq composite (down 0.57 to 1760.54, Charts) finished virtually flat, losing less than 1 point. The Nasdaq hit a 16-month high Tuesday as the Dow reached its highest level in 14 months.

"I think the HP earnings had the market set off earlier this morning," said John Davidson, president and CEO of PartnersRe Asset Management. "I think the market generally has a positive tone in respect to the economic indicators and the hope for the future."

At the start of the trading session, HP's disappointing quarterly report triggered the round of profit-taking many on Wall Street had expected after two days of solid gains in the market this week. The broader market lifted off its lows late in the morning when the initial shock of the report wore off. Strength in individual issues, including Network Appliance and PETCO, lent support to the Nasdaq.

Investors likely will turn their attention back to the economy Thursday, as a few reports on the docket have the potential to move the market.

The government was scheduled to report its weekly jobless claims number ahead of the opening bell Thursday, expected to drop to 395,000 from 398,000 in the week ended Aug. 6, according to a survey of economists by Briefing.com. The report could draw attention, as claims have remained below the critical 400,000 mark, which would indicate growth in the labor market, for four consecutive weeks.

Shortly after the start of trading, the Conference Board releases its index of Leading Economic Indicators for July. Economists expect the index to rise by 0.4 percent, compared with a 0.1 percent rise in the prior month.

Around noon, the Philadelphia Fed plans to release its index of manufacturing in the region for August, forecast to bump up to 10 from 8.3 in July. Any number over zero indicates an increase in manufacturing activity.

In addition, more retail earnings could garner attention. Clothiers Gap (GPS: Research, Estimates) and Limited (LTD: Research, Estimates), department store chain Nordstrom (JWN: Research, Estimates), kitchen supply store Williams-Sonoma (WSM: Research, Estimates), donut maker Krispy Kreme (KKD: Research, Estimates) and booksellers Barnes & Noble (BKS: Research, Estimates) and Borders (BGP: Research, Estimates), among others, were set to post quarterly results.

Stocks succumbed to pressure from Dow component Hewlett Packard (HPQ: down $2.31 to $19.80, Research, Estimates) on Wednesday. HP posted a profit of 23 cents a share late Tuesday, up from 14 cents in the year-earlier period but 3 cents below Wall Street's average forecast. HP was the last Dow stock to report for the quarter.

The stock had gained more than 30 percent since HP's previous quarterly earnings report, reflecting the broader market's solid advances but also as investors began warming up to the thought that its controversial merger with Compaq was finally beginning to pay off. Some of this gain came undone Wednesday as the stock sank 10.5 percent.

But parts of the technology sector received support from news that industry group Semiconductor Equipment and Materials International (SEMI) said orders for chip equipment from North American manufacturers rose in July from the previous month. It was the first increase since March, according to the group's report.

Shares of Intel (INTC: down $0.11 to $26.36, Research, Estimates) flip-flopped throughout the session, ending close to where it started the day, after the SEMI report and news that Prudential started coverage of the top chipmaker with a "buy" rating in a research note dated Aug. 19.

Data-storage systems maker Network Appliance (NTAP: up $2.83 to $20.88, Research, Estimates) also helped buoy techs. Shares of the company jumped 15.7 percent after it posted fiscal first-quarter earnings of 8 cents a share, up from 5 cents in the same period last year and beating analysts' average estimate by a penny.

Positive earnings reports from pet store chain PETCO and women's clothing company Talbots lifted the retail sector and helped mute losses on the broader market. PETCO (PETC: up $3.41 to $27.94, Research, Estimates) jumped 13.9 percent and Talbots (TLB: up $1.15 to $35.55, Research, Estimates) rose 3.3 percent.

But news that the Food and Drug Administration has approved a rival drug to its blockbuster Viagra sent Pfizer (PFE: down $0.53 to $30.74, Research, Estimates) stock down 1.7 percent. The new potency booster is GlaxoSmithKline's (GSK: down $0.04 to $39.75, Research, Estimates) Levitra.

Market breadth was positive, with six stocks rising for every five that fell on the New York Stock Exchange as 1.2 billion shares changed hands. On the Nasdaq winners edged out losers as 1.5 billion shares traded.

Treasury prices fell, sending the 10-year note yield up to 4.43 percent from 4.36 percent late Tuesday. The dollar rose versus the euro and fell against the yen.

Most European markets ended lower Wednesday. Asian stocks closed mixed. (Check the latest on world markets)

NYMEX light sweet crude oil futures rose 34 cents to $31.04 a barrel. COMEX gold rose $4 to $367 an ounce.