Dow dips, Nasdaq drifts

NEW YORK (CNNMoney.com) -- Stocks were mixed Thursday afternoon, with techs higher on Cisco's earnings and blue chips lower amid rising oil prices and some concerns about what a Democratic Party-controlled Congress will mean for select sectors.

The Dow Jones industrial average (down 52.82 to 12,123.72, Charts) lost almost 0.4 percent, with roughly 2-1/2 hours left in the session. The blue-chip barometer ended the previous session at an all-time high. The broader S&P 500 (down 2.91 to 1,382.81, Charts) index lost 0.2 percent.

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The tech-fueled Nasdaq composite (up 2.57 to 2,387.51, Charts) added a few points, giving back bigger morning gains. On Wednesday, the Nasdaq closed at its highest level since February 2001.

Stocks rose modestly Wednesday at the end of a tough session as investors tried to come to terms with the reality of Democrats controlling all of Congress, something the market had not been expecting.

The implications of the new political landscape remained in focus Thursday, but shared the stage with corporate and economic news.

"Stocks had a big run-up leading into the election and now there's almost a little fatigue, with investors wondering what the next leg up will be," said Peter Dunay, investment strategist at Leeb Capital Management.

He said that the reaction over the past two days shows that the stock market is not unhappy with the prospect of gridlock - with Congress and the White House controlled by separate parties. However, now investors want to return the focus to the fundamentals, including corporate news and the economy.

In corporate news, Cisco Systems (up $1.77 to $26.87, Charts) rallied 7 percent Thursday and gave a boost to the broader tech sector.

After the close Wednesday, Cisco reported higher fiscal first-quarter earnings and sales that topped estimates. The company also issued a bullish fiscal second-quarter revenue outlook.

Dell (up $0.85 to $25.03, Charts), Apple Computer (up $1.24 to $83.69, Charts), Oracle (up $0.38 to $18.74, Charts), Hewlett-Packard (up $0.77 to $39.65, Charts) and Microsoft (up $0.28 to $29.26, Charts) all gained too.

A variety of gold and silver industry stocks rallied, jumping in tune with the price of the raw commodity.

The Amex Gold Bugs (up $12.20 to $339.70, Charts) index added 3.7 percent, while the iShares Silver Trust (up $5.82 to $129.99, Charts) index added 4.8 percent.

Urban Outfitters (up $2.67 to $21.67, Charts) rallied almost 15 percent in active Nasdaq trade after the clothing retailer issued third-quarter earnings that topped forecasts and said current-quarter results would beat expectations as well.

But drug, defense and healthcare stocks continued to slip, reflecting Wall Street's concerns about how new Democratic Party legislation might impact those sectors.

Dow 30 components Merck (down $1.28 to $43.06, Charts), Johnson & Johnson (down $1.78 to $66.21, Charts) and Pfizer (down $0.63 to $25.99, Charts) all declined.

Dow stocks Verizon Communications (down $0.77 to $36.09, Charts) and AT&T (up $0.07 to $34.37, Charts) also slipped on concerns that a bill related to telecom-reform legislation won't go through with a Democratic Party-controlled Congress.

Market breadth was negative. On the New York Stock Exchange, losers beat winners eight to seven on volume of 1.05 billion shares. On the Nasdaq, decliners topped advancers three to two on volume of 1.55 billion shares.

In economic news, the U.S. trade deficit narrowed more than what analysts were expecting in September, due to lower oil prices and record exports.

Weekly jobless claims fell a greater-than-expected 20,000 to 308,000, reflecting strength in the labor market.

U.S. light crude oil for December delivery rose 72 cents to $60.55 a barrel on the New York Mercantile Exchange.

Treasury prices were little changed from late Wednesday, with the yield on the 10-year note holding at 4.63 percent. Bond prices and yields move in opposite directions.

COMEX gold rose $16.60 to $634.90 an ounce.

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