U.S. stocks erased gains, turning little changed on Thursday as a modest improvement seen in a jobs data was not enough to keep markets up.

Weekly jobless claims declined more than expected last week, briefly sending stocks higher, but the four-week average of new claims, a measure regarded as better reflecting labor market trends, rose to a nine-month high, offsetting the enthusiasm.

Healthcare and consumer staple shares were the biggest losers among the S&P 500 sectors. On the blue-chip Dow, Kraft Foods was among the biggest percentage decliners, falling 1 percent to $29.27.

We want more people to be finding jobs, and the claims data is a good sign for that, but this isn't something you can stick your hat on and think everything is better. We'd like to see additional hiring in the private sector, said Anthony Halpin, investment adviser at Chicago Partners Investment Group LLC in Chicago.

The Dow Jones industrial average .DJI was down 6.36 points, or 0.06 percent, at 10,053.70. The Standard & Poor's 500 Index .SPX was up 0.27 point, or 0.03 percent, at 1,055.60. The Nasdaq Composite Index .IXIC was down 2.61 points, or 0.12 percent, at 2,138.93.

Major indexes are off about 6.5 percent from their August 9 high because investors have grown concerned about the sharp slowdown in the economy or some fear a double-dip recession as data showed growth deteriorating in various sectors.

Reflecting those concerns about the economy, the percentage of individual investors who expect stocks to rise in coming months fell to the lowest level since March 2009.

The American Association of Individual Investors' measurement of stock market sentiment showed the day's Bull reading was at 20.7, down from 30.1 last week and at the lowest level since March 2009 when it was 18.9. Bears, however, rose 7 points on the week to 49.5. In March of 2009, Bears hit 70.3.

In merger news, data storage company 3PAR Inc accepted a sweetened bid from Dell Inc, trumping a bid from Hewlett-Packard Co.

Shares of Dell rose 0.6 percent to $11.86 and HP, a Dow component, was up 0.3 percent at $38.35. [ID:nN26185803] 3PAR shares dipped 2.5 percent to $26.07.

Investors will be watching developments at Jackson Hole, Wyoming, where central bankers from around the world have converged to assess the darkening economic outlook.

Federal Reserve Chairman Ben Bernanke in a speech on Friday is likely to discuss the uncertain prospects for the economy but isn't expected to give many clues about whether the U.S. central bank will pump more cash into the economy to keep the recovery going.

(Reporting by Angela Moon, Editing by Kenneth Barry)