Stocks hold steady after unemployment insurance rolls fall for first time since January

Stocks little changed after employment data

NEW YORK — Stocks were little changed in early trading Thursday as investors took the latest sign of improvement in the labor market in stride.

Investors are also awaiting congressional testimony from Treasury Secretary Timothy Geithner on the White House’s proposed overhaul of the nation’s financial regulatory system.

The Labor Department said the overall number of people drawing unemployment benefits fell for the first time since early January. The drop broke a string of 21 straight increases.

However, new unemployment claims edged up by 3,000. Still, this was less than economists had expected.

The report was not enough to reinvigorate investors, who have pushed stocks lower over the first three days of this week amid growing pessimism about an economic rebound.

“The news this morning was encouraging but it’s part of the less-bad string of data we’ve seen in recent weeks,” said Alan Gayle, senior investment strategist at RidgeWorth Investments. “We need significant more improvement to suggest that the economy is really turning the corner.”

Investors are looking to Geithner’s testimony Thursday before the Senate Banking Committee and the House Financial Services Committee for more insight into how the biggest changes to financial regulation since the 1930s might unfold. House Republicans, for example, said Obama’s plan would hurt the market by imposing unnecessary regulation.

The plan outlined by President Barack Obama on Wednesday would give new powers to the Federal Reserve to oversee the entire financial system and would also create a consumer protection agency to guard against credit and other abuses.

In the first half hour of trading, the Dow Jones industrial average rose 0.16 to 8,497.34. The Standard & Poor’s 500 index rose 0.56, or 0.1 percent, to 911.27, while the Nasdaq composite index fell 0.45, or 0.02 percent, to 1,798.90.