Meanwhile, Greece agreed with its EU and IMF lenders to impose yet deeper austerity, a senior official told Reuters, but a euro zone official later told CNBC there is no truth to the Reuters report. A Greek official declined comment.
The market tried to find its footing after a sharp selloff in the previous session triggered by news of unexpected weakness in the manufacturing sector and a smaller-than-expected gain in private payrolls, and compounded Moody's downgrade of Greece's debt deeper into junk status.
Further signs of weakness emerged as jobless claims fell less than expected Thursday, and retailers offered a mixed report on May same-store sales. But most investors were awaiting the May's jobs report on the government due Friday for a clearer picture of the economy's health.
"Leading into the unemployment data tomorrow, investors are very concerned the numbers are going to be worse than expected," said Jonathan Corpina, senior managing partner, Meridian Equity Partners. "I think the bar is set really, really low for tomorrow."