NEW YORK (MarketWatch) -- U.S. stocks on Thursday pulled mostly higher, with investors brushing off early declines in an attempt to reverse course after three days of losses, with Cisco Systems' cautious outlook weighing on technology shares.
Chart of $INDU
After sliding at the start, the Dow Jones Industrial Average recently was up about 18 points to 12,220.3, with 18 of its 30 components trading higher. The gains were led by Home Depot Inc. (HD:
Home Depot, Inc
 Last: 28.38+0.73+2.64%
11:16am 02/07/2008
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HD 28.38, +0.73, +2.6%) , up 3.4%.
Among the blue chips, Wal-Mart Stores (WMT:
Wal-Mart Stores, Inc
 Last: 48.99+0.16+0.33%
11:16am 02/07/2008
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WMT 48.99, +0.16, +0.3%) shares edged lower after the planet's biggest retailer led a slew of U.S.-based retailers reporting a miserable start to the year. Read more.
"The Cisco earnings and weaker-than-expected Wal-Mart sales were the early downside catalysts," said Elliot Spar, option/market strategist at Stifel Nicolaus & Co.
The S&P 500 ($SPX:
S&P 500 Index
 Last: 1,325.52-0.93-0.07%
11:36am 02/07/2008
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$SPX 1,325.52, -0.93, -0.1%) gained 5.35 points to 1,331.8, while the Nasdaq Composite (COMP:
COMP
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COMP, , ) shed 0.75 points to 2,278.
Volume on the New York Stock Exchange came to 383 million, and advancing stocks outran those declining 4 to 3. On the Nasdaq, 787 million shares exchanged hands, and decliners topped advancers 7 to 6.
Other Thursday data included a report from the National Association of Realtors, which said sales of existing homes fell 1.5% in December, marking a second monthly drop. Read more.
"The data are worse that forecast, but not really a surprise as the housing market remains weak and looks to remain so through at least mid-year, with many economists not seeing much stabilization until later this year," said analysts at Action Economics.
Shares of Cisco Systems (CSCO:
Cisco Systems, Inc
 Last: 22.50-0.58-2.51%
11:21am 02/07/2008
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CSCO 22.50, -0.58, -2.5%) were down more than 3% after the networking giant forecast 10% revenue growth in the fiscal third quarter, against the 15% rise that analysts had expected. Fiscal second-quarter profit rose 7%
"What began as a slowdown in the U.S. in the second quarter is now spreading, as both U.S. and Europe saw unexpected softness in January," said Richard Windsor, an analyst for Nomura International. "This is particularly troubling as North America and Europe make up 70% of its revenue."
Crude also continued its prior day's declines, with oil futures falling 44 cents to $86.70 a barrel on the New York Mercantile Exchange. See Futures Movers.
Also on the Nymex, gold futures for April delivery dropped $1.10 to $903.9 an ounce. Read Metals Stocks.
Before the opening bell, the Labor Department said jobless claims fell last week but also revised the prior week's count higher, with continuing claims at their highest level in more than two years. Read Economic Report.
'This is the stuff recessions are made of.'
Kevin Giddis, Morgan Keegan & Co.
"The average monthly consumer credit numbers are falling but delinquencies are rising. This is not the stuff that economic rebounds are made of. This is the stuff recessions are made of," said Giddis.
Overseas, the Bank of England cut rates 25 basis points to 5.25%.
The move came in reply to "slower consumer spending and a weakening housing market," said Wachovia Corp. analyst Jill Trainor.
The European Central Bank, however, held its key rate steady at 4%, with ECB President Jean-Claude Trichet telling a news conference that while data have confirmed the bank's view that economic risks are weighted to the downside, inflation remains the key concern.
On Wednesday, stocks closed with losses for a third consecutive day after a Federal Reserve official indicated inflation worries could limit future interest-rate cuts. End of Story
Kate Gibson is a reporter for MarketWatch, based in New York.