Wall St falls as stronger dollar weighs

By Edward Krudy

NEW YORK (Reuters) - U.S. stocks fell on Thursday as a stronger dollar weighed on commodity shares and a guarded outlook from Wal-Mart Stores Inc led to worries about the level of consumer spending.

The drop in shares threatened to snap a six-day winning streak for the Dow industrials as stocks slipped from 13-month highs made in the last session.

Wal-Mart, the world's largest retailer, reported a higher quarterly profit but forecast earnings for the current period that could miss Wall Street's consensus estimate. The stock gained 1.1 percent to $53.55.

The U.S. dollar headed higher against major currencies, bolstered by a report showing initial U.S. weekly jobless claims had fallen to their lowest level since January.

The currency's rise weighed on dollar-denominated commodity prices, including crude oil futures, which fell 3 percent to below $77 a barrel.

The dollar has traded inversely to stocks for most of the year, moving lower as the S&P 500 has gained more than 60 percent since early March.

"In the past two days we are seeing a modest rebound off the (dollar's) lows," said Steve Goldman, market strategist, Weeden & Co in Greenwich, Connecticut. "It's a catalyst or an excuse to take some profits."

The Dow Jones industrial average fell 49.88 points, or 0.48 percent, at 10,241.38. The Standard & Poor's 500 Index lost 6.29 points, or 0.57 percent, at 1,092.22. The Nasdaq Composite Index was down 7.00 points, or 0.32 percent, at 2,159.90.