Stocks turn mixed

NEW YORK (CNNMoney.com) -- Blue chips trimmed losses and techs turned higher Thursday morning as investors mulled a bout of weak reading on the economy, another drop in oil prices and some disappointing December retail sales.

The Dow Jones industrial average (down 17.46 to 12,457.06, Charts) lost about 0.2 percent more than 90 minutes into the session, while the broader S&P 500 (down 1.06 to 1,415.57, Charts) index was barely lower.

The Nasdaq (up 13.41 to 2,436.57, Charts) composite gained more than 0.5 percent, thanks to strength in select tech shares.

A weaker-than-forecast report on factory orders and in-line reading on the services side of the economy kept worries about growth in play, while the retail sales numbers sparked concerns about consumer spending.

But the weakness was tempered by a drop in oil prices and a bounce in a number of big tech stocks.

Intel (up $0.73 to $21.08, Charts) jumped after Bank of America raised its first-quarter and fiscal-year 2007 earnings per share estimates on the chipmaker, Briefing.com reported, citing better momentum in notebooks and servers.

Apple Computer (up $1.79 to $85.59, Charts), Dell (up $0.52 to $26.01, Charts) and eBay (up $0.94 to $31.11, Charts) were among the other tech gainers lifting the Nasdaq.

Factory orders rose 0.9 percent in November, the government reported Thursday morning, versus forecasts for a rise of 1.4 percent. Orders fell a revised 4.5 percent in October.

The Institute for Supply Management's index on the services sector fell to 57.1 in December from 58.9 in November. Economists thought it would fall to 57.

The two reports served to add to recent concerns that the economy is slowing more than has been expected. Such worries were put into place Wednesday as well, the first trading day of 2007.

Stocks gave up a rally Wednesday following the afternoon release of the minutes from the last Fed policy meeting. The minutes showed the bankers remain concerned about the pace of core inflation and the economic slowdown - and that they may not cut interest rates any time soon.

Market participants also eyed a mixed take on December sales at the nation's retailers, with apparel chains suffering in response to unusually mild weather and competition from large discounters like Wal-Mart Stores (up $0.35 to $47.90, Charts).

Wal-Mart posted a better-than-expected gain of 1.6 percent in stores open a year or more, a figure also known as same-store sales. Wal-Mart shares were little changed in the early going.

Wholesale operator Costco (up $1.08 to $53.92, Charts) also reported stronger-than-expected sales growth. Shares rose about 1.5 percent.

On the downside, teen clothing seller Hot Topic (down $2.54 to $11.00, Charts) reported a steeper-than-expected decline in the month, sending shares much lower in the morning.

U.S. light crude oil for February delivery fell 90 cents to $57.42 a barrel on the New York Mercantile Exchange following the release of the weekly oil inventory report. The report showed a bigger-than-expected drop in crude supplies.

Treasury prices gained, lowering the yield on the benchmark 10-year note to 4.62 percent from 4.66 percent late Wednesday. Bond prices and yields move in opposite directions.

COMEX gold for January delivery fell $8.10 to $627.10 an ounce.

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