Before trading opened, the Commerce Department reported a 0.3 percent dip in retail sales for January caused by a sharp drop in auto sales — though without those sales, the retail figure would be up 0.9 percent for the month. Economists had been expecting a flat performance. First-time unemployment claims for the first full week of February were at 363,000, more than the 345,000 expected by Wall Street and 6,000 higher than the previous week.

"What we're seeing is a little profit-taking after what was a favorable response to the comments the Fed made," said Stuart Freeman of A.G. Edwards & Sons. "Some of the stocks that moved aggressively Wednesday were very cyclical companies, and now you're seeing rotation back into more defensive positions."

Greenspan spent a second day on Capitol Hill, this time before a Senate committee. He continued the themes from his House testimony — better-than-expected gross domestic product growth, a lowered inflation estimate for the year and a warning against mounting federal budget deficits. His outlook sent stocks sharply higher on Wednesday.

Investors also were continuing to weigh Comcast Corp.'s hostile takeover bid for The Walt Disney Co. Comcast was down $1.17 at $30.06, while Disney gained 40 cents to $28.00.

"Speaking broadly, more mergers can be a comforting indicator from an investor's perspective," said Jack Caffrey of J.P. Morgan Private Bank. "It shows that companies are comfortable with their own operations, their own management and their own finances."