U.S. stocks retreated Thursday, with investors hesitant to make big bets on equities before Friday's jobs report and as retailers reported mixed sales for August.

The Dow Jones industrial average was down 1.76 points, or 0.02 percent, to end at 11,381.15. The Standard & Poor's 500 Index was down just 0.45 of a point, or 0.03 percent, at 1,303.82. The Nasdaq Composite Index was down 1.98 points, or 0.09 percent, at 2,183.75.

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But the three major U.S. stock indexes posted gains for the month, with the Nasdaq up 4.4 percent, its best advance for August in six years.

Tame core consumer price inflation data from the Commerce Department failed to inspire investors, as did midday comments from Federal Reserve Chairman Ben Bernanke, who said that growth in U.S. labor force productivity is likely to remain strong..

Same-store sales at teen-oriented retailers American Eagle Outfitters Inc. (AEOS) and Abercrombie & Fitch Co. (ANF) beat Wall Street's expectations, while J.C. Penney Co. Inc.'s and Jos. A. Bank Clothiers Inc. sales disappointed investors.

"There's nothing compelling here to really move the market either way. Economic numbers that came out today were bland ... and retail sales were kind of mixed," said Victor Pugliese, managing director and head of New York equity trading at First Albany Corp. "The holiday weekend has started."

For the month, the Dow rose 1.8 percent and the S&P 500 gained 2.1 percent. The Nasdaq and the S&P 500 had their best monthly percentage gains since January, while the Dow had its best since April.

Volume on Thursday was light ahead of the long Labor Day holiday weekend, with just 1.33 billion shares changing hands on the New York Stock Exchange, well below last year's daily average of 1.61 billion.

On Friday, investors will comb through the nonfarm payrolls report for August to glean clues about the outlook for interest rates ahead of the Fed's Sept. 20 policy-setting meeting.

"We have a flurry of numbers tomorrow that will very much impact the outlook," said Hugh Johnson, chief investment officer of Johnson Illington Advisors in Albany, New York. The employment number is "the grandpappy of them all in any given month."

Shares of upscale department store chain Nordstrom Inc. (JWN) shot higher after it said sales at stores open at least a year beat Wall Street expectations. Nordstrom's stock jumped 5.9 percent, or $2.07, to end at $37.35 on the NYSE.

Strong back-to-school shopping lifted August sales, and the shares of teen retailers American Eagle, up 3.9 percent, or $1.43, at $38.61 on the Nasdaq, while Abercrombie added 1.8 percent, or $1.15, to $64.53 on the NYSE.

In contrast, shares of department store operator J.C. Penney edged down 0.2 percent, or 12 cents, to $63.04. Shares of men's apparel retailer Jos. A. Bank Clothiers sank 16 percent, or $4.56, to $23.93 on the Nasdaq after the company reported a decline in August same-store sales.

Shares of mining equipment maker Joy Global Inc. jumped 21.5 percent, or $7.71, to $43.54 after it reported a profit that topped analysts' expectations and forecast revenue growth for the next 12 months.

Shares of Exxon Mobil Corp. (XOM) were the biggest drag on the S&P 500 index, even as U.S. crude oil for October delivery rose 23 cents to settle at $70.26 a barrel. Exxon Mobil shares fell 0.9 percent, or 63 cents, to $67.67 on the NYSE and also weighed on the Dow.

Before the opening bell, the U.S. Commerce Department reported that core consumer prices, stripping out food and energy, rose slightly less than economists had forecast. That suggested that the Fed may be able to keep rates steady after pausing in August from a two-year campaign to tighten monetary policy.

This indicator — released as part of the July personal income and consumption data — is one of the Fed's favorite inflation gauges. It is known as the core personal consumption expenditure, or the core PCE, index.

A survey from the National Association of Purchasing Management-Chicago showed growth in business activity in the Midwest slowed slightly, stirring some fears of a recession.

Volume on the Nasdaq was about 1.75 billion shares traded, below last year's daily average of 1.80 billion.

Advancing stocks outnumbered declining ones by a ratio of about 3 to 2 on the NYSE and by 8 to 7 on Nasdaq.

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