* Weekly jobless claims fall to 265,000
* Nvidia top drag on Nasdaq, biggest S&P loser
* Bank sector set to fall for second day in a row
* Indexes down: Dow 0.03 pct, S&P 0.03 pct, Nasdaq 0.11 pct
(Adds details, comments, updates prices)
By Yashaswini Swamynathan
Dec 29 U.S. stocks gave up early gains and were
little changed in light trading on Thursday as weakness in
financials offset gains in healthcare companies.
A report showed the number of Americans applying for jobless
claims fell by 10,000 to 265,000 last week, indicating sustained
strength in the labor market.
U.S. equities had been enjoying a rally since the
presidential election in November on bets that Donald Trump
would introduce tax cuts, deregulation and higher infrastructure
spending that would spur economic growth.
The near two-month rally has seen the three main Wall Street
indexes rack up double-digit percentage gains, but has left some
market participants nervous about a potential correction.
The S&P 500 index suffered its biggest one-day percentage
drop on Wednesday, following weak housing data and losses in the
technology sector. The triple-digit loss on the Dow pulled it
further away from its march towards 20,000.
"The market is looking like it has gotten a bit ahead of
itself, and while I'm not turning bearish, I am becoming a bit
more cautious in the near-term," said Robert Pavlik, chief
market strategist at Boston Private Wealth.
"I wouldn't be surprised to see the market begin the year
with a little bit of a rally and start to give back quickly."
At 10:56 a.m. ET (1556 GMT), the Dow Jones Industrial
Average was down 6.14 points, or 0.03 percent, at
The S&P 500 was down 0.73 points, or 0.03 percent, at
The Nasdaq Composite was down 6.12 points, or 0.11
percent, at 5,432.44.
Six of the 11 major S&P 500 sectors were higher, led by
gains in the defensive utilities and consumer staples
- those that have largely underperformed in the
Financials, which have gained the most from the
Trump rally, were off 0.7 percent, building on losses from a day
Bank of America was among the top five drags on the
S&P 500, while Goldman Sachs weighed the most on the Dow.
Chipmaker Nvidia was the top percentage loser on
the S&P 500, falling nearly 4 percent, a day after short-seller
Citron Research tweeted that the stock could fall to $90 in
2017. The stock was also the biggest drag on the Nasdaq.
The Philadelphia SE Semiconductor index was off 0.7
Drug developer Cempra lost more than half of its
value after the U.S. Food and Drug Administration rejected its
antibiotic treatment for pneumonia.
Advancing issues outnumbered decliners on the NYSE by 1,759
to 978. On the Nasdaq, 1,432 issues rose and 1,178 fell.
The S&P 500 index showed one new 52-week highs and two new
lows, while the Nasdaq recorded 48 new highs and 23 new lows.
(Reporting by Yashaswini Swamynathan in Bengaluru; Editing by