NEW YORK (MarketWatch) -- U.S. stocks slipped at the open Thursday as a mixed batch of earnings from the likes of Merrill Lynch, International Business Machines, and Pfizer failed to inspire the market after the previous session's rally.
The Dow Jones Industrial Average was down 27 points at 12,591, with 19 of its 30 components opening lower, led lower by financial components Bank of America and JP Morgan Chase , along with United Technologies .
The market didn't get any relief from the freshest snapshot of the weakening U.S. labor market. Jobless claims rose by 17,000 to 372,000 in the latest week, more or less in line with market expectations, the Labor Department said.
Financial shares lost some of their gains from Wednesday, with Merrill Lynch falling 1.9% after it swung to a quarterly loss of $1.96 billion and said it would cut 4,000 jobs.
Pfizer , a Dow component, slipped 3.2% as the drug-making giant said its profit dropped 19% but held onto its profit guidance for the year.
Also among Dow components, IBM rose 1.3% after the technology giant recorded a 26% profit rise, topping analyst forecasts, and upped its 2008 forecast.
"IBM beat revenue and earnings expectations substantially with strength across the board," said American Technology Research Analyst Shaw Wu. "We find this quite impressive in light of the tough economic environment."
But technology shares were under pressure. Online auctioneer eBay slumped 2.9% before the open, even with the firm posting a strong increase in its bottom line, as its core auction continued to show weakness.
The S&P 500 index was down 2.4 points to 1,362 and the Nasdaq Composite lost 9.2 points to 2,340.
Google shares slipped 0.5% ahead of its earnings after the close Thursday. Oppenheimer analyst Jason Helfstein said Google's management, while not providing financial guidance, has sent signals that it hasn't been affected by the economic slowdown.
But "to the extent this quarter disappoints, or the company's tone changes, we see less investor support," he said.
Telecom shares were higher overall, even with Nokia slumping 12.3%. The mobile phone giant reported a 25% profit rise but lowered its forecast for mobile device sales by value this year.
Separately, The Wall Street Journal reported Yahoo was closer to outsourcing search advertising to Google after a positive initial test.
Pause after the rally
U.S. stocks had rallied Wednesday as results and outlooks from Intel Corp., J.P. Morgan Chase and others helped boost confidence in earnings season, while resource stocks were helped by commodities strength. The Dow Jones Industrial Average finished with a gain of 256 points, the Nasdaq Composite added 64 points and the S&P 500 rose 30 points.
Coming economic data include the Philadelphia Federal Reserve index for April and leading indicators from March, as well as speeches from Federal Reserve Vice Chairman Donald Kohn, Dallas Fed President Richard Fisher and Richmond Fed President Jeffrey Lacker.
The dollar climbed against the Japanese yen, while oil futures slipped slightly to $114.85 a barrel.
The Nikkei 225 closed 1.9% higher in Tokyo. The FTSE 100 was down in afternoon trade.
By Nick Godt