NEW YORK (CNN/Money) - Blue chips ended lower Thursday, but the broader market fought back after a big wave of selling that followed news that GM and Ford bonds had been cut to junk status.

Friday brings what is likely the most anticipated economic report of the month, the April payrolls report.

The Dow Jones industrial average (down 44.26 to 10,340.38, Charts) lost around 0.4 percent Thursday, with GM its biggest decliner.

The broader Standard & Poor's 500 (down 3.02 to 1,172.63, Charts) index lost just under 0.3 percent.

Both major gauges had sported losses of 0.7 percent to 0.8 percent throughout the afternoon.

The Nasdaq composite (down 0.43 to 1,961.80, Charts) ended little changed.

Stocks had been flat to a bit higher throughout the morning in quiet trading ahead of Friday's jobs report. But investors were thrown a curve in the afternoon by the news about the automakers, not to mention a reversal in oil prices.

Still, investors showed some resilience, with stocks trimming losses by the close.

Treasury prices gained as investors sought the perceived safety of government debt after the GM and Ford downgrades. The dollar struggled to make headway against the yen and euro.

Direction Friday is likely to be influenced by the payrolls component of the April employment report. Economists surveyed by Briefing.com expect that employers added 175,000 to their payrolls in April after tacking on 110,000 in March.

In March, economists thought employers would have added more than twice as many jobs as they did.

"I think the market has already discounted that the actual number tends to be a bit off (versus estimates)," said John Hughes, market analyst at Shields & Co. "As long as we get something that is near estimates, the market should be OK with it."

The unemployment rate, generated by a separate survey, is expected to hold at 5.2 percent, unchanged from the previous month.

The report is due at around 8:30 a.m. ET.

General Motors (down $1.94 to $30.86, Research) rallied 15 percent Wednesday after investor Kirk Kerkorian made an $868 million tender offer for another 5 percent of the company's stock -- a move that could shake up the troubled automaker.

But the stock, already suffering some profit taking Thursday morning, tumbled even lower on afternoon news that its debt rating has been reduced to junk status by ratings agency Standard & Poor's.

This change could ultimately cause its borrowing costs to rise, making it harder for the troubled automaker to compete globally.

S&P cut Ford Motor (down $0.46 to $9.70, Research) debt to junk status as well, sending shares of the two automakers lower.

Auto-parts equipment suppliers fell, too, including Delphi (down $0.28 to $3.57, Research) and Visteon (down $0.20 to $3.74, Research).

Mixed reads on the economy -- including a rise in jobless claims and a reversal in oil prices -- added to the weakness.

U.S. light crude for June delivery rose 70 cents to settle at $50.83 a barrel on the New York Mercantile Exchange.

Looking out, "I think short term, the trend remains slightly to the upside, just 'cause we had gotten so oversold," said Tom Schrader, managing director of listed trading at Legg Mason, noting that the stock market first needed to get through the jobs report Friday.

In addition to GM, which fell just under 6 percent, the Dow's other big decliner was IBM (down $1.58 to $75.50, Research).

The tech leader lost 2 percent after saying late Wednesday that it would cut 13,000 jobs -- mostly in Europe -- as part of an international cost-cutting plan that will result in a pretax charge of between $1.3 billion and $1.7 billion.

Merck (down $0.18 to $34.75, Research) announced that Richard Clark, a longtime veteran of the drugmaker who previously ran the manufacturing division, will take over for outgoing CEO and president Raymond Gilmartin, who is retiring next year. Shares lost 0.5 percent.

TXU (down $3.32 to $79.10, Research) slipped after the power producer reported earnings that grew from a year earlier, but missed forecasts.

Calpine (down $0.19 to $2.06, Research) fell after reporting a wider quarterly loss, as had been warned last week. The independent electricity producer blamed costs associated with new plants.

Computer data storage maker QLogic (down $4.10 to $30.00, Research) fell 12 percent after issuing a current-quarter forecast that is short of forecasts.

A number of retailers reported April sales, and results were generally more upbeat than in the previous month.

Among the highlights: Wal-Mart Stores (up $0.12 to $48.57, Research) said same-store sales, or sales at stores open a year or more, rose 0.9 percent in the month, just shy of forecasts.

Teen apparel retailer American Eagle Outfitters (up $1.75 to $27.77, Research) reported same-store sales rose 20 percent in the month, versus forecasts predicting a rise of 18.9 percent.

Market breadth was mixed. On the New York Stock Exchange, winners beat losers eight to seven on volume of nearly 1.61 billion shares. On the Nasdaq, decliners barely edged advancers as 1.75 billion shares changed hands.

Jobless claims gained a more-than-expected 11,000 to 333,000 last week from a revised 322,000 the previous week.

The report was particularly of interest in that it came a day before the monthly report.

Productivity rose at a 2.6 percent annual rate in the first quarter, the government reported. That was up from a 2.1 percent rate in the fourth quarter and above estimates.

Treasury prices rose, lowering the ten-year note yield to 4.15 percent from 4.18 percent late Wednesday. Bond prices and yields move in opposite directions.

In currency trading, the dollar was little changed versus the euro and the yen.

COMEX gold rose 70 cents to settle at $430.70 an ounce.