Traders work on the floor of the New York Stock Exchange
Traders work on the floor of the New York Stock Exchange. REUTERS

U.S. stocks declined in early trade on Thursday after Department of Labor reported that weekly jobless claims unexpectedly rose last week.

The S&P 500 Index declined 8.90 points, or 0.66 percent, to trade at 1,338.42 at 9:35 a.m. EDT. The Dow Jones Industrial Average fell 59.68 points, or 0.47 percent, to trade at 12,663.90. The Nasdaq Composite Index declined 0.53 percent.

The Department of Labor reported that initial jobless claims increased by 43,000 to 474,000 for the week ended Apr. 30 from the previous week's revised figure of 431,000, while economists expected 400,000. The 4-week moving average of initial claims gained 22,250 to 431,250 from the previous week's revised average of 409,000.

The weekly jobless claims data comes a day ahead of the government's monthly nonfarm payrolls report, which is the most closely-watched economic data pertaining to the jobs market and is a key gauge for the direction and pace of the economic recovery.

Productivity of nonfarm U.S. business workers rose at an annual rate of 1.6 percent in the first quarter compared to 2.9 percent pace in the fourth quarter.

Most of the U.S. retailers reported better than expected same-store sales results in April, helped by Easter purchases in the month. Macy's, Inc. (NYSE:M) shares advanced 1.10 percent to $25.67 after the company said its same-store sales in April rose 10.8 percent from a year ago.

On the corporate front, JDS Uniphase Corp. (NASDAQ:JDSU) shares surged 9.45 percent to $21.88 as its third quarter earnings and revenue exceeded Street view. Adjusted profit was $51.0 million or $0.22 per share, up from $23.2 million or $0.10 per share last year.

Whole Foods Market Inc. (NASDAQ:WFMI) shares gained 4.34 percent to $62.25 in early trade. Its second quarter net income rose to $89.9 million or $0.51 per share compared to $67.5 million or $0.39 per share in the same quarter last year. Whole Foods expects its fiscal 2011 earnings to be in the range of $1.87 to $1.90 per share compared to its previous estimation of $1.76 to $1.80 per share.

The euro declined 0.75 percent to 1.4716 against the dollar and the yen gained 0.99 percent against the greenback.

Crude oil futures plunged 3.38 percent to $105.55/barrel and gold futures fell 0.69 percent.

European stock markets are currently trading lower with FTSE 100 down by 66.41 points, DAX30 down by 58.71 points and CAC 40 down by 54.88 points.