NEW YORK

Wall Street's erratic day ends slightly lower

NEW YORK — Wall Street ended a mildly erratic day slightly lower Thursday after anxiety about widening credit problems offset optimism about a $2 billion capital infusion into troubled mortgage lender Countrywide Financial Corp.

The market gave up a moderate early gain, but fluctuations were expected given the uncertainty about the credit markets and the fact that stocks posted big gains Wednesday.

Bank of America Corp.'s investment in the nation's largest mortgage lender was seen as a way to not only prop up Countrywide but also prevent any further losses at the mortgage lender from hurting the underlying economy.

The market will likely be trading nervously "until we get some clarity from the Fed," said Jim Herrick, manager and director of equity trading at Baird & Co.

The Federal Reserve's moves to ease the market's credit concerns have had some palliative effect on Wall Street. But "some would argue that this is a Band-Aid approach to a bigger problem. ... The big unknown is how widespread this problem is," Herrick said.

The market showed little response Thursday to policymakers' infusion of another $17.25 billion into the banking system to help boost liquidity, adding to the $41.25 billion the central bank has injected since the beginning of last week.

The Dow fell 0.25, or less than 0.01 percent, to 13,235.88.

Broader indexes fell modestly. The Standard & Poor's 500 index lost 1.57, or 0.11 percent, closing at 1,462.50. The Nasdaq composite index fell 11.10, or 0.43 percent, to 2,541.70.

Potter book boosts Barnes & Noble profit

NEW YORK — Barnes & Noble Inc., the largest U.S. bookseller, said Thursday that its second-quarter earnings rose 9 percent, boosted by sales of J.K. Rowling's "Harry Potter and the Deathly Hallows."

The company also said it expects a loss in the third quarter, but boosted its yearly guidance to reflect tax benefits and lower-than-expected costs for closing a distribution center.

Profit for the quarter that ended Aug. 4 rose to $18.1 million, or 26 cents per share, from $16.6 million, or 24 cents per share, in the year-ago period. Results include 12 cents per share in previously unrecognized tax benefits and 3 cents per share for lower distribution center closing costs.

Revenue rose nearly 8 percent to $1.24 billion.

WASHINGTON, D.C.

Fewer filings for jobless help reported

Fewer people signed up for jobless benefits last week, an encouraging sign that most businesses aren't resorting to big layoffs amid a housing slump and the painful credit crunch.

The Labor Department reported Thursday that new applications filed for unemployment insurance dipped by 2,000 to 322,000 for the week that ended Aug. 18. It marked the first drop in new claims in roughly a month.

The level of claims suggested that the employment climate remains in fairly good shape despite problems in housing, tighter credit and turmoil on Wall Street in recent weeks.

"The main message here is at least so far there is little contagion effect from Wall Street," said Ken Mayland, president of ClearView Economics. "As long as the number is below 350,000, it is generally consistent with a decent economy and a relatively healthy labor market."

Meanwhile, the four-week moving average of claims rose to 317,750 last week, an increase of 4,750 from the prior week. A year ago, those claims stood at 316,750.

The number of people continuing to collect unemployment benefits went up by 16,000 to 2.57 million for the week that ended Aug. 11, the most recent period for which that information is available. A year ago, the figure was 2.48 million.

SpongeBob SquarePants items recalled

An Ohio importer recalled nearly 250,000 SpongeBob SquarePants address books and journals made in China because the bindings might contain hazardous levels of lead paint, the Consumer Product Safety Commission said.

Martin Designs Inc. notified the agency that tests of the metal spiral bindings turned up lead content above the level considered safe for children, the commission said Wednesday. Children's products found to have more than 0.06 percent lead accessible to users are subject to a recall.

Children who ingest lead-laced paint can suffer brain damage. The company said it has received no reports of injury.

The recall involves address books and journals sold in stores nationwide from June 2006 through July 2007. They have a black metal spiral binding and depict the SpongeBob SquarePants character in various outfits on the front cover.

The recalled address books' UPC code, printed on the back cover, is 80773007505; the recalled journals have the UPC codes 80773002260, 80773075501 and 80773007551.

Consumers should dispose of the product and return the UPC code for a full refund to Martin Designs, Attention: Product Recall, 605 Westlake Drive, Ashland OH 44805.

For information, consumers can call 866-898-0261 or visit the company's Web site, www.martindesigns-ltd.com.

TEXAS

Penney's recalls 4,000 spindle-back chairs

DALLAS — J.C. Penney Co. is recalling 4,000 spindle-back chairs because they can collapse, federal officials said.

The recall covers Windsor Spindle-Back sets of four side chairs made from solid hardwood in Malaysia. The backs and legs are painted white and the seat is a natural wood color.

The Consumer Product Safety Commission said Thursday that Penney has received four reports of the chairs collapsing and one minor whiplash injury. The chairs were sold through Penney's catalog and online businesses from April 2006 through June 2007. Consumers who bought the chairs should stop using them and contact Penney to get free replacements or a refund. Penney has set up a recall hotline, 888-333-6063. The commission's recall hotline is 800-638-2772.