In morning trading, the Standard Poor’s 500-stock index dropped 29.67 points, or 2.35 percent. The Dow Jones industrial average lost 243.44, or 2.05 percent, to 11,653.00, and the Nasdaq index slid 70.24 points, or 2.61 percent.
New claims for unemployment benefits in the United States edged down last week, pointing to a marginal improvement in the labor market, the Labor Department said.
“Essentially, claims have stalled and the growth of employment has stalled, which is very consistent with what we know to be the case for the economy,” said Hugh Johnson, chief investment officer of Hugh Johnson Advisors LLC in Albany, N.Y.
“Everything, the claims numbers included, says the same thing — the economy has stopped.”
The S.P. 500 index rose on Wednesday after seven straight losing sessions, but worries about the economy kept investors jittery and trading volatile with Friday’s key unemployment report looming.
Further weighing on futures were comments from European Central Bank President Jean-Claude Trichet that “downside risks may have intensified.”
Retailers will be in focus as chain stores reported healthy July sales increases. Deep discounts and the warmest weather in decades brought shoppers to malls.
But the clothes retailer Aeropostale slid 10.4 percent after it forecast second-quarter revenue below estimates.
General Motors edged up 0.04 percent to $27.18 after it reported quarterly profit nearly doubled.
Kraft Foods jumped 5.7 percent to $36.25 after it disclosed plans to split into two listed companies: global snacks and North American groceries. It also posted better-than-expected quarterly results.
Article source: http://feeds.nytimes.com/click.phdo?i=19e201b35b1ec607bc985c8bfb521578
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