NEW YORK (AP) — U.S. stocks edged lower as investors mulled the outlook for interest rates, the latest sanctions against Russia and volatile energy prices. Health care stocks, the year's biggest gainers, fell back. Lululemon, the high-end yoga apparel maker, surged after reporting income that beat expectations.
KEEPING SCORE: The Standard & Poor's 500 index fell five points, or 0.3 percent, to 1,990 as of 1:27 p.m. Eastern. The Dow Jones industrial average dropped 50 points, or 0.3 percent, to 17,019. The Nasdaq composite fell 22 points, or 0.5 percent, to 4,563.
JOBS PICTURE: More Americans sought unemployment benefits last week, though the trend in applications over the past month remained low. Applications are a proxy for layoffs. The four-week average fell to an eight-year low of 293,750. Generally, fewer applications indicate employers are holding onto their staffs.
SHEER RISE: Lululemon jumped $6.08, or 16 percent, to $43.36 after the troubled yoga-gear retailer reported earnings that beat analysts' expectations. The company also raised its full-year forecast. Lululemon has been trying to turn itself around since last spring, when it pulled one of its popular yoga pants from stores because they were too sheer.
FED THOUGHTS: The Federal Reserve is never far from investors' minds, and many are already looking forward to next week's meeting of policy makers. The Fed is currently winding down its economic stimulus measures, and investors will be expecting an update on the economy and more insight into when the central bank might begin raising interest rates. The Fed concludes its latest two-day policy meeting next Wednesday.
THE QUOTE: "Interest rates have not been a headwind (for stocks) for some time now," said Jim Russell, a regional investment director at USBank. "We are entering into a period now where they will have to be considered again."
SLUGGISH SEPTEMBER: Stocks have moved lower this week after closing at a record high on Friday. September is historically the weakest month for the stock market, according to data from the Stock Traders' Almanac. The S&P 500 is down 0.6 percent so far this month.
OIL STEADIES: The price of oil fell to its lowest level in more than a year in early trading before recouping its losses and heading higher in early afternoon trading. Oil was up 64 cents, or 0.7 percent, at $92.35 a barrel in early afternoon trading. Oil dropped $1.08 on Wednesday and has fallen for five of the past six trading sessions. Crude prices fell Wednesday after the Organization for Petroleum Exporting Countries lowered its growth forecasts for global crude oil demand.
HEALTH CARE PAUSE: Health care companies led declines in the S&P 500 index with a drop of 0.5 percent. The industry has been the best performing sector in the index this year, climbing 15.1 percent, compared to an 7.7 percent gain for the broader index.
SWEET MUSIC: Pandora Media jumped $1.06, or 4 percent, to $27.14. The internet music company said that it had agreed to a "multi-year" deal for a U.S. license with BMG, a music rights management company. BMG represents the music rights of artists including John Legend and Bruno Mars.
RUSSIA FACTOR: European markets were weighed down by news that the European Union has decided to go ahead with a new round of sanctions against Russia. The penalties will take effect Friday and will curb access to European financial markets for more Russian companies and banks. They also limit exports of some high-end technology and put travel and asset freezes on a list of individuals. Investors worry that stronger sanctions will hurt the economies and trade relations of Russia and Europe.
CURRENCIES: The dollar was little changed against the yen after its recent gains against the Japanese currency. The U.S. currency is at its highest level in six years against the yen. On Thursday one dollar bought 106.90 yen. The dollar fell to $1.293 against the euro.
BONDS: The yield on the 10-year Treasury note fell to 2.53 percent from 2.54 percent on Wednesday.