Jobless data that suggested some improvement in the economy were overshadowed by a drop in existing home sales that pushed stocks and most ETFs lower Thursday.

The Dow Jones Industrial Average reversed its early gains, dropping 64 points to close at 9785. The Nasdaq slipped 31 to 2105, and the S&P 500 shed 13 to 1048.

Although the Labor Department said that initial claims for jobless benefits fell 21,000 to 530,000 in the week ended Sept. 19, that wasn't enough to sustain a rally. Home builder and real estate funds were hit by the bad housing results.

Continuing claims (drawn by workers for more than a week) in the week ended Sept. 12 fell by 123,000 to 6,138,000 from the preceding week's revised level of 6,261,000. August unemployment figures put the national jobless rate at 9.7%.

Within hours of that announcement, the National Association of Realtors reported existing home sales dropped 2.7% in August, the first decline in five months. The figure indicates the challenges the real estate sector faces in a slow, erratic recovery.

For a detailed rundown on Thursday s trading session see our market story.

Winners

The gyrations of major indexes pushed up shares of the iPath Exchange Traded Notes S&P 500 VIX Short-Term Futures Index fund by 1.2%. The United States Natural Gas fund (UNG) climbed 2.1% as commodity prices closed mixed.

Losers

Declines in crude prices dropped the iPath S&P GSCI Crude Oil Total Return Index fund by 3.2%. The SPDR S&P Homebuilders dropped 2.0% as home sales figures indicated the difficulty of selling new houses against an inventory of lower priced and foreclosed houses.

Thursday s Industry Headlines

Launching Pad
State Street Global Advisors, the investment management unit of State Street, oversaw the launch of the SPDR S&P VRDO Municipal Bond exchange traded fund, which began trading Thursday on the New York Stock Exchange. The fund tracks the price and yield performance of the S&P National AMT-Free Municipal VRDO Index, an index of variable rate demand obligations (VRDOs), an asset class exempt from federal taxes and often state and local income taxes. It charges an annual expense ratio of 0.20%.

Data Point
ETFS Marketing, manager of the ETFS Physical Silver Shares and ETFS Physical Swiss Gold Shares, announced it has hired Garrett Smith as senior vice president for sales. The two funds had $217 million in assets under management as of Sept. 22. Smith formerly worked at Claymore Securities assisting in the development of ETF distribution and marketing strategies, and was previously with Rydex Investments, where he was involved in launching about 30 exchange-traded funds.

Friday s Notebook

Earnings and Conference Calls
AZZ, KB Home, Qualstar

Economic Data
8:30 a.m. Durable Goods Orders
9:55 a.m. Consumer Sentiment
10:00 a.m. New Home Sales