Dow closes slightly lower as jobs report looms; oil climbs back above $50

Stocks closed mixed to modestly lower Thursday as traders await Friday's key jobs report and digest oil's climb back above $50 per barrel and a continued drop in the British pound on Brexit fears.

The Dow Jones industrial average fell 12.53 points, or 0.1%,to 18,268.50, according to preliminary calculations. At one point the blue-chip index was down as much as 118 points. The Standard & Poor's 500 stock index was up 1.04, or 0.05%, to 2160.77 and the Nasdaq composite fell 9.17, or 0.2%, to 5306.85.

Stocks rallied Wednesday, ending a two-day losing skid, enabling the Nasdaq to climb within 0.4% of a fresh record high and putting the Dow and S&P 500 within 2% of their August peaks.

Wall Street is in a holding pattern ahead of the release of the September jobs report  Friday. Analysts are forecasting job gains of 170,000 to 175,000, following the creation of just 151,000 new jobs in August. A strong jobs report could give the Federal Reserve more reason to hike interest rates later this year for the first time in 2016. Low rates and borrowing costs have been a key driver of stock gains in the current bulll market, now well into its seventh year.

Rising long-term bond yields in the U.S. may also be weighing on stocks. The yield on the 10-year Treasury note jumped to 1.739%. Rates appear to be heading higher as odds of a late-year Fed rate hike remain firm.

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Oil prices were a bright spot. A barrel of U.S.-produced crude was up 61 cents to $50.44 a barrel. It was the first time oil has breached $50 a barrel since July 1. Data from the Energy Information Administration released Wednesday showed a fifth straight week of declining crude supplies. Crude is also getting a lift from last week's OPEC meeting, when the Middle East cartel said it had reached an understanding that scaling back production is necessary to support prices in a world awash in oil. Fears of possible supply disruptions due to Hurricane Matthew may also be playing a part in oil's strength.

In economic news, the number of Americans filing for first-time unemployment benefits sank by 5,000 to 249,000 in the latest week, its lowest level since the 1970s.

In individual stock news, shares of Twitter (TWTR) fell 20% to $19.87 amid a report that would-be suiters Google and Walt Disney are not seen making bids after all for the troubled social media company.

The British pound remained under pressure, as traders continue to lighten up on the currency after the British prime minister this past weekend said the UK would trigger the so-called Brexit negotiations no later than the end of the first quarter of 2017. The fact that Brexit now looks like a reality has caused a spike in uncertainty as investors still have few details on what the UK's economic role and health will look like in a post-Brexit world.

Stocks in Europe were mixed. London's FTSE 100, a stock index filled with multinational British companies with big export businesses, was down 0.5% on Brexit uncertainty. The FTSE 100's emphasis on exports actually benefits from a weak pound, as a weak currency makes their goods more competitively priced abroad.

Also in Europe, the German DAX index was down 0.2%, the CAC 40 in Paris was trading down 0.2% and the broad Stoxx Europe 600 index was off 0.4%.