TODAY'S PAPER
59° Good Evening
59° Good Evening
Business

Markets fall as new jobless claims rise

Stocks tumbled Thursday after two disappointing economic reports renewed investors' concerns about the pace of the recovery.

The Dow Jones industrial average fell 144 points. All the major stock indexes fell more than 1 percent. Interest rates also fell sharply as investors moved back into the safety of Treasury bonds.

The Labor Department said initial claims for unemployment benefits rose unexpectedly last week and the Federal Reserve of Philadelphia said manufacturing activity in the mid-Atlantic region has dropped during August.

The pair of economic reports followed news that Intel Corp. was acquiring McAfee Inc. The deal, valued at $7.68 billion, was not enough to offset the weaker economic readings.

The reports are the latest in a months-long string of conflicting readings on the economy. The reports have shown the pace of a rebound is slowing and that companies are skittish about adding new workers. That has hurt stocks on some days in recent weeks. It has also stoked fears about the economy falling back into recession.

At the same time, corporate announcements, including earnings reports for the past six weeks, have largely showed companies are doing well. Mergers and acquisitions activity is often considered a positive sign because it means companies are willing to spend money to expand their businesses and are confident that prospects are improving.

The Dow fell 144.33, or 1.4 percent, to 10,271.21. The Standard & Poor's 500 index fell 18.53, or 1.7 percent, to 1,075.63, while the Nasdaq composite index fell 36.75, or 1.7 percent, to 2,178.95.

About four stocks fell for every one that rose on the New York Stock Exchange, where volume came to almost 1.1 billion shares.

Volume has been particularly light in recent weeks, even by summer standards, meaning many investors are still uncertain about the direction of the economy. Bond prices rose after the weak jobs and manufacturing reports. - AP

Comments

We're revamping our Comments section. Learn more and share your input.

More news