* Goldman Sachs falls after downgrade
* Oil recovers, reverses energy sector decline
* Indexes: Dow off 0.1 pct, S&P flat, Nasdaq up 0.1 pct
(Updates to midday, changes byline)
By Chuck Mikolajczak
NEW YORK (Reuters) - U.S. stocks recovered from
initial declines Thursday in a choppy session as commodity
prices kept the market in flux while a downgrade of Goldman
Sachs dragged down financial shares.
Commodities rebounded after U.S. data showed a decline in
jobless benefit claims last week and a revision to retail sales
data suggested consumer spending in the first quarter might
have been stronger than initially thought.
U.S. crude futures advanced 0.5 percent after a drop
of more than 1 percent and the S&P energy sector rose
0.1 percent after falling more than 1 percent. The sector has
tumbled 7.9 percent this month after it gained 16.3 percent in
the first quarter to propel the benchmark S&P 500 to a 5.4
"Commodities have had a great run-in here. We are just
going to get some volatility going forward, both in the up
direction and down direction," said Wayne Schmidt, chief
investment officer at Gradient Investments in St. Paul,
Financial shares fell after banking analyst Dick Bove of
Rochdale Securities put a "sell" rating on Goldman Sachs Group
and reduced the price target on the stock to $120 from
$163, citing litigation worries.
Goldman shares slumped 4.5 percent to $141.17 as volume
topped the 50-day moving average. Both the KBW bank index
and the S&P financial sector shed 0.6 percent.
Cisco Systems Inc warned Wednesday it would
fare worse this quarter than Wall Street had forecast. The tech
company laid out plans for global job cuts as it struggles to
revive growth. Its shares fell 4.5 percent at $16.99.
The Dow Jones industrial average dropped 16.04
points, or 0.13 percent, to 12,613.99. The Standard & Poor's
500 Index shed 0.04 point to 1,342.04. The Nasdaq
Composite Index gained 4.01 points, or 0.14 percent, to
The recent spate of profit-taking in commodities pulled
copper prices to their lowest since Dec. 1, while spot silver
lost more than 5 percent after tumbling about 9 percent
Wednesday. The iShares Silver Trust dropped 2.3 percent
The Reuters/Jefferies CRB index, a broad measure of
commodity performance, slipped 0.3 percent on Thursday and has
lost 8.7 percent so far in May.
(Reporting by Chuck Mikolajczak; Editing by Kenneth Barry)
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