US stocks off to shaky start in Q2

NEW YORK: US stocks kicked off the second quarter in a glum mood,
closing a holiday-shortened week Thursday with minor losses as Europe's
financial woes hung over positive US economic data.

Caution was
the byword as markets braced for Friday's closely watched official jobs
numbers. The stock market will be closed for Good Friday.

"US stocks finished the day mixed, ending a rough week for the equity markets," said analysts at Charles Schwab and Co.

"Traders
appeared unwilling to leave risk on the table heading into the long
weekend, especially as debt concerns in the eurozone continued to swirl
today, and as the jobs report will be released tomorrow."

The
blue-chip Dow Jones Industrial Average closed Thursday at 13,060.14
points, slipping a fractional 0.01 percent over the week since last
Friday.

The Standard and Poor's 500, a broad measure of the markets, also shed 0.01 percent to finish at 1,398.08.

Proving a bit more resilient, the tech-rich Nasdaq was essentially flat at 3,080.50.

"The
news on the domestic economy, especially on employment, has been good
enough that the Federal Reserve has indicated that it is less likely to
launch any more quantitative easing (QE)," said Nigel Gault, chief US
economist at IHS Global Insight.

"Although financial markets do
not like that message, it is good news since it implies that the Fed
thinks the economy is healthy enough to keep improving without emergency
assistance."

Most analysts expect the Labour Department will
report Friday that unemployment remained stuck at 8.3 percent for the
third month in a row in March.

All eyes will be on whether the
recent solid pace of job growth continues, although a somewhat softer
number than in February is anticipated.

Analysts pointed to the recent months-long bull run that cries out for a correction.

"'Buy
on the rumor, sell on the news,' that slogan seems to explain the
selloff in stock prices," said Ed Yardeni of Yardeni Reseach.

"The
news has been mostly good coming out of the US. So the drop is probably
more about the correction of an overbought market than it is about the
news," he said.

Europe inspired nail-biting, as Spain, and even
France, were forced to pay more to borrow amid fears the eurozone debt
crisis is deepening.

"The potential for a flare-up of sovereign
debt concerns in the eurozone -- and specifically Spain -- is the real
bugaboo weighing on the psyche of equity market participants," said
Patrick O'Hare at Briefing.com.

"These thoughts have a way of
festering just ahead of an earnings reporting period that is expected to
show a deceleration in earnings growth," he added.

Analysts at
24/7WallSt.com noted "some growing caution" about company expectations
"on the heels of a massive rally where the DJIA rose 8.1 percent and the
SandP 500 rose 11.9 percent in the first quarter alone."

Aluminum giant Alcoa, the first Dow member to report, unofficially kicks off earnings season after the market closes Tuesday.

Internet
giant Google posts its first-quarter earnings Wednesday. The market
gets its first look at big banks Friday, with JPMorgan Chase and Wells
Fargo reporting.

The economic calendar features the Federal
Reserve's Beige Book on Wednesday. The report, a compilation of economic
conditions nationwide, is produced for the policy-setting Federal Open
Market Committee, which next meets on April 24 and 25.

Inflation will be in focus, in the wholesale pipeline on Thursday and on the consumer side Friday.

The February trade balance report is also scheduled Friday. -AFP