By Anora Mahmudova, MarketWatch

NEW YORK (MarketWatch) -- The U.S. stock market ended a volatile session on Thursday with modest losses, driven by renewed selloffs in previously high-flying names.

Optimism following better-than-expected jobless claims and dovish comments from European Central Bank President Mario Draghi, who said the ECB stood ready to act in June, faded by midafternoon.

At session highs, the Dow Jones Industrial Average jumped 100 points and topped its previous record close level. The S&P 500 turned south after getting within a hair's breadth to its closing record.

Still, the declines were not uniform, as the Dow Jones Industrial Average (DJI) managed to stay in positive territory by the end of the session, closing 32.43 points, or 0.2%, higher at 16,550.97.

The S&P 500 (SPX) ended the day down 2.58 points, or 0.1%, at 1,875.63.

The Nasdaq Composite (RIXF) shed 16.18 points, or 0.4%, to 4,051.50, losing 2.1% over the past three sessions. Biotech stocks sold off, with the Nasdaq Biotechnology index (NBI) down 1.9%.

The Russell 2000 (RUT) index of small stocks closed 11 points, or 1%, lower at 1,097.43.

Peter Cardillo, chief market economist at Rockwell Global Capital, said the downward movement was due to a combination of two things: technical resistance on the S&P 500 and the Dow, and Nasdaq's failure to put in a solid recovery from recent declines.

"There is little evidence that weakness in Nasdaq has come to an end. We are seeing more selective markets, investors are no longer chasing high-growth stocks and want solid large-cap dividend-paying companies," Cardillo said.

Read the recap of MarketWatch's live blog of today's stock-market action.

Federal Reserve Chairwoman Janet Yellen appeared before the Senate Budget Committee in her second day of testimony before Congress to discuss the central bank's economic and fiscal outlooks.

Answering questions from the senators, Yellen said that the shrinking of the middle class is a disturbing trend and student debt is preventing people from buying homes and that is affecting the housing market.

In economic news, the number of people who applied for new unemployment benefits last week fell to the lowest level in a month, but the decline likely stemmed from seasonal quirks instead of any major change in hiring trends or layoffs.

Initial jobless claims dropped by 26,000 to a seasonally adjusted 319,000, the Labor Department said Thursday. Economists surveyed by MarketWatch had expected claims to fall to 325,000 in the week ended May 3.

Telsa skids, SolarCity soars

Tesla (TSLA) skidded 11% after its earnings report late Wednesday. The company said it had a net loss of 40 cents a share. Adjusted per-share income came in at 12 cents, versus analyst forecasts of 8 cents. A rise in costs, constraints on production, and muted delivery forecasts punished the stock, however.

An earnings report also pulled down Gulfport Energy Corp. (GPOR) by 19%. The company earned 20 cents a share on revenue of $118 million, compared with analyst forecasts of 20 cents a share on $123 million in sales.

Wynn Resorts Ltd. (WYNN) retreated 4.1% amid concerns about a decline in demand in Macau, according to news reports. The concerns for the casino company follow a crackdown on unlawful money transfers in the region, a hot spot for gamblers in Asia.

SolarCity Corp. (SCTY) jumped 12% after the solar company reported its first-quarter earnings. The energy company said it had adjusted per-share losses of 82 cents a share on revenue of $63.6 million. The firm was expected to lose 70 cents per share on revenue of $53 million.

Keurig Green Mountain (GMCR) climbed 13% after its second-quarter earnings report. The single-serving coffee maker took in adjusted profits of $1.08 per share on sales of $1.10 billion. Forecasts had called for 95 cents a share in earnings on revenue of $1.05 billion.

Shares of Priceline Group Inc. (PCLN) fell 2.1% after the travel-services company's current-quarter forecasts fell short of Wall Street's targets. Priceline also said first-quarter earnings rose 36%, aided by growth in international bookings.

European stocks gain after Draghi's 'ready to act in June' comment

Asian stocks rose following better-than-expected trade data from China, while European stocks advanced after Draghi said the central bank is ready to act in June.

The euro(EURUSD) fell sharply against the U.S. dollar after Draghi's comments.

Gold futures (GCM4) priced were unchanged, after a 1.5% downturn Wednesday. June oil futures (CLM4) fell slightly, stepping back from gains on Wednesday.

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