U.S. stocks fought back from early losses Thursday that were sparked by weak retail sales numbers and rising jobless claims.

The consumer staples sector was the biggest loser, declining 0.9%, followed by financial stocks, down 0.8%.

How are equity markets faring?

The Dow Jones Industrial Average

DJIA, -0.22%

trimmed losses to be down just 14 points at 25,529, while the S&P 500 index

SPX, -0.09%

edged up less than a point to 2,753. The Nasdaq Composite Index

COMP, +0.21%

 gained 24 points, or 0.3%, to 7,444.

At session lows, the Dow had dropped as many as 235 points, the S&P had shed 22 points and the Nasdaq was 45 points off.

What’s driving the market?

Investors were caught by surprise by a report showing that U.S. retail sales fell by 1.2% in December, the largest single-month decline since 2009 and well below the flat growth expected by economists polled by MarketWatch. That came at the same time that jobless claims showed an unexpected rise in the number of Americans applying for unemployment benefits.

Stock-index futures had risen ahead of those numbers amid optimism over U.S.-China trade talks and a new deal to avoid a government shutdown. Reports had indicated that President Donald Trump may extend the tariff truce with Beijing by another 60 days if a trade deal appears near, Bloomberg News reported.

Trump has described talks, among the biggest concerns for market participants, as going “very well.” However, some observers are expecting only a limited trade deal to come to fruition, particularly if a March deadline isn’t extended.

Meanwhile, Trump was expected to sign border-security legislation, which would avert a partial government shutdown.

Earlier, reports on Japanese gross domestic product matched market expectations, while Chinese exports and imports were better than expected, as German growth numbers stagnated, painting a mixed picture of the state of the international economy.

The U.S. producer-price index fell by 0.1% in January, lower than the 0.1% increase expected by economist polled by MarketWatch.

Business inventories dropped 0.1% in November, according to a report delayed by the partial government shutdown.

Which stocks are in focus?

Shares of Amazon.com Inc.

AMZN, -0.88%

declined 0.6% after the e-commerce giant announced that it has abandoned its plan to build its New York City headquarters, citing opposition from politicians.

Read: This is what Amazon’s ‘HQ2’ was going to cost New York taxpayers

Coca-Cola Co.

KO, -7.81%

 shares fell 7.6% after the beverage giant reported results that showed the company falling short of fourth-quarter revenue expectations.

Shares of Cisco Systems Inc.

CSCO, +2.73%

 rose 2.7% after earnings and the network giant’s outlook topped Wall Street expectations.

Shares of NetApp Inc.

NTAP, -5.67%

slid 5.2% after the cloud data services company issued a fiscal third-quarter earnings report that showed it falling short of revenue expectations.

Bloomin’ Brands Inc.

BLMN, +9.70%

shares jumped 9.3% after the parent company of Outback Steakhouse reported fourth-quarter profits and sales that surpassed Wall Street expectations.

CenturyLink Inc.

CTL, -12.86%

shares sank 12% after the integrated communications firm reported earnings that fell short of analysts’ revenue expectations.

Shares of Avon Products Inc.

AVP, -10.34%

skidded 12% after the beauty products company reported fourth-quarter results.

Shares of Six Flags Entertainment Corp.

SIX, -14.31%

tumbled 14% after the firm reported weaker-than-expected fourth quarter earnings.

Read: Morgan Stanley warns of a looming earnings recession

What are strategists saying?

“There’s no denying the retail sales number was no good and rotten,” Steve Chiavarone, portfolio manager with Federated Investors, told MarketWatch. But one number is not enough to sour on the health of the U.S. consumer, he added.

“When you think about the low unemployment rate, that unemployment claims are still low and that incomes are growing, there’s not much other evidence that the consumer is unhealthy,” Chiavaronne said.

See: The Nasdaq is about to exit from bear-market territory

How are other markets trading?

Asia stocks closed mostly lower, with Hong Kong’s Hang Seng Index

HSI, -0.23%

China’s Shanghai Composite Index

SHCOMP, -0.05%

 slipping, while the Nikkei

NIK, -0.02%

ended the day virtually unchanged.

European stocks declined, with the Stoxx Europe 600

SXXP, -0.32%

finishing weaker.

Crude-oil futures

CLH9, +1.17%

gained and gold

GCH9, +0.08%

settled fractionally lower. The U.S. dollar

DXY, -0.21%

meanwhile, fell relative to its peers.

—Mark DeCambre contributed to this report.

Also read: Michael Brush on 6 easy ways to reach for ‘safe’ dividend yield with energy stocks

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