NEW YORK (CNN/Money) - U.S. stock markets ended Wednesday near where they started the session, but could bounce back into rally mode Thursday following a better-than-expected quarterly report from tech heavyweight Cisco after the closing bell.

After the day's choppy, lackluster trading, the Nasdaq composite (up 1.41 to 1959.37, Charts) managed to close on the plus side, adding less than 2 points. But the Dow Jones industrial average (down 18.00 to 9820.83, Charts) fell about 0.2 percent, and the Standard & Poor's 500 (down 1.44 to 1051.81, Charts) ended the day about 0.1 percent lower.

Throughout the day, investors proceeded with caution, wary of making any major moves ahead of Cisco's report, which came in better than expected after the closing bell. Traders said the report could help techs jump back into a rally that has helped the Nasdaq soar 47 percent since the start of 2003.

"I clearly think this is just another manifestation of a recovery that continues to be underestimated by the Wall Street community," said Ned Riley, chief investment strategist at State Street Global Advisors. "Not only Cisco, but the whole tech sector has blown away estimates. I would be truly surprised if the market doesn't have strong futures and a positive start Thursday."

All eyes focused on Cisco Systems (CSCO: up $0.22 to $21.80, Research, Estimates). After the close of trading, the top maker of Internet routers posted earnings of 17 cents a share, excluding certain one-time charges, which was 2 cents better than Wall Street's average expectation. The company also reported sales of $5.1 billion, up 5.3 percent from the same period last year and better than the $4.86 billion analysts expected, according to First Call.

Investors also watched Cisco's report and comments for more signs that corporations are buying new equipment. In a conference call Wednesday, Cisco CEO John Chambers was cautiously optimistic about the state of the industry.

Cisco's shares jumped 6.6 percent in after-hours trading on Instinet.

Thursday trading also brings the weekly reading on jobless claims, which could give investors a peek into Friday's key monthly employment report for October. The number of Americans filing new claims for unemployment is forecast to have fallen to 380,000 in the week ended Nov. 1 from 386,000 the previous week.

State Street's Riley added that investors' focus is likely to shift to Friday's jobs report later in the day Thursday.

The October employment report is expected to show that the unemployment rate for October held at 6.1 percent, but that employers added 65,000 jobs to their payrolls after adding 57,000 jobs in September, according to Briefing.com.

The government also was set to provide a preliminary report on productivity for the third-quarter Thursday, which expected to have risen 8.5 percent from 6.8 percent in the prior quarter, according to Briefing.com.

A morning reading Wednesday on the services industry brought on some selling, despite coming in better than expected. The Institute for Supply Management's services activity index for October came in higher than expected at 64.7, up from 63.3 in September. Economists had forecast a increase to 63.4, according to Briefing.com. Any reading above 50 signifies expansion in the sector.

At the same time, the Commerce Department said factory orders in September rose 0.5 percent compared with a 0.8 percent decline in August, a reading slightly lower than Wall Street's expected rise of 0.6 percent.

"Traders found some weakness in the factory orders in the ISM report after digging around," said Jack Ablin, chief investment officer at Harris Trust.

Meanwhile, the Nasdaq felt pressure from some online ventures. Online travel retailer Priceline.com (PCLN: down $7.59 to $21.66, Research, Estimates) tumbled 26 percent after warning late Tuesday that its fiscal fourth-quarter results will miss expectations, despite posting better-than-expected third-quarter earnings.

Online services firm InterActiveCorp (IACI: down $2.81 to $34.19, Research, Estimates) also weighed, shedding 7.8 percent after posting a third-quarter operating profit of 17 cents per share, a penny below Wall Street's estimates. The company also warned that its 2003 profit is likely to fall below analysts' estimates.

There were also some sectors that showed strength. Homebuilder stocks clocked gains, with Beazer Homes (BZH: up $5.00 to $106.31, Research, Estimates) rising 5 percent, Hovnanian (HOV: up $3.53 to $86.38, Research, Estimates) up 4.4 percent and Toll Brothers (TOL: up $2.79 to $40.28, Research, Estimates) soaring 7.5 percent.

Metal miners also headed higher. Olympic Steel (OLY: down $0.10 to $1.30, Research, Estimates) jumped 9 percent, while Cleveland-Cliffs (CLF: up $2.24 to $34.30, Research, Estimates) added 7.6 percent and Miramar Mining (MNG: up $0.11 to $2.12, Research, Estimates) bumped up 5 percent.

The Dow Jones industrial average rallied to a 17-month high Monday, and the Nasdaq composite index reached a 21-month high before both fell Tuesday as some investors chose to cash in on those gains.

Market breadth was positive. Advancers edged past decliners on both the Nasdaq, where 2 billion shares traded, and the New York Stock Exchange, where 1.4 billion shares changed hands.

Treasury prices fell, with the 10-year note losing 7/16 of a point in price to yield 4.35 percent, up from 4.29 percent late Tuesday. The dollar gained against the yen and euro.

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NYMEX light sweet crude oil futures surged $1.55 to $30.30 a barrel. COMEX gold rose $2.70 cents to $382.70 an ounce.

European markets closed lower Wednesday. Asian-Pacific stocks ended mixed Wednesday, with Tokyo's Nikkei index down 0.1 percent.