* Jobless claims fall unexpected
* Dollar fluctuates on QE speculation
* Retailer shares rise on higher September sales
* Indexes off: Dow 0.1 pct, S&P 0.2 pct, Nasdaq 0.3 pct
* For up-to-the-minute market news see [STXNEWS/US] (Updates to open)
By Chuck Mikolajczak
NEW YORK, Oct 7 (Reuters) - U.S. stocks edged lower on Thursday as the dollar stemmed declines, with investors weighing the possibility of additional quantitative easing by the U.S. Federal Reserve.
The dollar rebounded after falling to a 15-year low versus the Japanese yen and an all-time low against the Swiss franc on the prospect of more money-printing by the Fed to prop up the economic recovery. For details, see [ID:nLDE6961PN]
The usual correlation between the euro and equities -- with both rising at the same time -- is based on expectations for Europe's economies. But the most recent movement in tandem is being based on the momentum behind the paired move, not economic fundamentals.
"Everybody is trying to play this quantitative easing idea: what are the central banks going to do. That certainly feels like part of it," said Kevin Kruszenski, head of listed trading at KeyBanc Capital Markets in Cleveland.
The Dow Jones industrial average <.DJI> shed 13.06 points, or 0.12 percent, at 10,954.59. The Standard & Poor's 500 Index <.SPX> lost 2.17 points, or 0.19 percent, at 1,157.80. The Nasdaq Composite Index <.IXIC> dipped 6.24 points, or 0.26 percent, at 2,374.42.
The latest economic data helped stocks early in the session. Initial claims for unemployment benefits dropped to their lowest since the July 10 week, the Labor Department said. [ID:nN06278713]
The data came ahead of Friday's key non-farm payroll report from the Labor Department, which is expected to show companies added 75,000 jobs in September. [ID:nN05187700]
The S&P retail index <.RLX> rose 0.7 percent as teen apparel retailers led generally stronger-than-expected same-store sales in September. [ID:nN06274816]
Abercrombie & Fitch Co
Alcoa Inc