The Dow Jones industrial average fell 28 points to 12,780 shortly after the opening bell. The Standard & Poor’s 500 index fell 1 point to 1,376 and the Nasdaq composite edged up one point to 2,897.

The market is coming off its worst two-day slide in a year. The Dow average plunged 434 since President Barack Obama won re-election as investors turned their focus to a deadline at the end of the year for Congress to act on reducing the budget deficit.

If it doesn’t, a series of drastic government spending cuts and tax hikes will kick into effect, potentially derailing the U.S. economy. The Congressional Budget Office said Thursday that the measures, if implemented, would likely push the economy back into recession.

The dimming outlook for Europe also weighed on markets this week. The European Commission, the executive arm of the European Union, slashed its forecast for economic growth in the region Wednesday.

The yield on the 10-year Treasury note edged up to 1.62 percent from 1.61 percent late Thursday.

Among stocks making big moves:

— Online deals company Groupon slumped $91 cents to $3.01 after it said after hours Thursday that it was hurt by the economic problems in Europe and growth failed to meet its expectations.

— J.C. Penney dropped $1.78 to $ 19.91 after the company reported a loss that was larger than investors were expecting. Shoppers have been abandoning the store after it got rid of blockbuster sales in favor of everyday low prices.

— Kayak Software surged $8.22 to $39.26 after the company said yesterday that it had agreed to be bought by Priceline.com Inc.