NEW YORK (AP) — An unexpected rise in jobless claims is causing investors to sell again.
A day after the Federal Reserve expressed confidence in the economy, the government said new jobless claims rose by 15,000 to 627,000 last week. The market had been expecting a decline.
Unemployment has been one of the most closely watched gauges of the economy throughout the recession as it affects many drivers of economic growth — most importantly, consumer spending.
Uncertainty about when the economy will turn around, and how fast it will grow when it finally does, have made for a rocky market this month. The Dow Jones industrial average remains up 26.8 percent from its 12-year low hit on March 9, but is down nearly 500 points, or 5.7 percent, from the five-month high it reached on June 12.
Rising unemployment claims shouldn’t be surprising to investors, because unemployment usually continues to increase even when the economy is improving, said Arthur Hogan, chief market analyst at Jefferies & Co. But the jump in claims was nevertheless leading to some selling on Thursday, he said.
“Investors are really on guard here. We’re at a juncture where investors don’t know what the next 10 percent move is — whether it’s up or down,” Hogan said.
In the first half hour of trading, the Dow fell 22.60, or 0.3 percent, to 8,277.26. The Standard & Poor’s 500 index fell 4.67, or 0.5 percent, to 896.27, and the Nasdaq composite index fell 13.16, or 0.7 percent, to 1,779.18.
The modest decline in stocks came after the Fed said Wednesday that “sustainable economic growth” should gradually resume, and inflation will “remain subdued for some time.” The statement did little to reassure investors, though, causing stocks to give up gains and finish mixed. Some were hoping the central bank would articulate how it will curb inflation.
One piece of good news on Thursday was a slightly improved reading on gross domestic product. First-quarter GDP shrank 5.5 percent, the Commerce Department said, less than the previous estimate of 5.7 percent.
Business
<img src=" http://www.joplinglobeonline.com/images/zope/thursday.gif" border=0> Stocks open lower after rise in jobless claims
- Business
-
-
Obama call for manufacturing revival a tough goal
President Barack Obama is making a strong election-year push for an economic revival “built on American manufacturing.” But he faces an uphill slog, with little consensus even within his own party on how to do it.
-
Stocks fall sharply as Greek deal is held up
Stocks are closing their worst day this year after Greece hit a roadblock on its way to a critical bailout.
-
Budget deficit drops to $27 billion in January
The budget deficit fell sharply in January compared to a year earlier, as an improving economy lifts income tax revenue.
-
Feds slap CA utility for San Onofre ammonia leak
Federal regulators say an ammonia leak that caused an emergency alert at Southern California’s San Onofre nuclear plant was caused by employees who failed to recognize degraded equipment and fix it.
-
Chicago officials make plans for potential massive protests of G-8, NATO summits
In Wisconsin, a group of environmentalists plans to bicycle to Chicago’s G-8 and NATO summits to protest an economy that relies too heavily on fossil fuel.
-
Obama praises Italian leader’s economic efforts
Eager for Europe to contain its economic troubles, President Barack Obama praised Italian Premier Mario Monti on Thursday for his efforts to lead Italy out of its fiscal quagmire.
-
Consortium in South wins federal approval for 2 new nuclear reactors
A consortium of utilities in the South won government approval Thursday to construct two new reactors at an estimated cost of $14 billion, the strongest signal yet that the three-decade hiatus of nuclear plant construction is finally ending.
-
Stocks fall at the open as Greek deal is held up
U.S. stocks opened lower Friday after Greece’s bailout deal was put on hold, a day after it seemed that the country had satisfied its creditors.
-
Asia stocks slip as Greek bailout remains in limbo
Asian stock markets dropped Friday after Europe’s finance ministers demanded more spending cuts from Greece before clearing a (euro) 130 billion ($170 billion) bailout to stave off the country’s bankruptcy.
-
Google’s first employee leaves to join education nonprofit
Google Inc.’s first hired employee, Craig Silverstein, is leaving the tech giant, where he’s worked since its founding, to sign on with the rising education startup Khan Academy.
- More Business Headlines
-
Denver's Largest-Ever Drug Bust Nets Dozens
Marines: No Punishment for Nazi-like Flag
Vets Look to Translate Military Skills Into Jobs
Expert: Removing LA School's Staff 'Appropriate'
Raw Video: School Bus Burst Into Flames
LA School Reopens Amid Sex Abuse Scandal
$25B Settlement Reached Over Foreclosure Abuses
Pentagon: Allow Women Closer to Front Lines
Obama Gives Education Waivers to 10 States
Giffords Aide to Run for Her Seat
LA School in Sex Abuse Scandal Reopens
Winter Slamming North Asia, Parts of Europe
Syrian Forces Renew Bombardment of Homs
States, Banks Reach Foreclosure-abuse Settlement
Raw Video: Italy's Mount Etna Bursts Into Life
Greeks March; Angry Despite Debt Deal
Raw Video: U.S. Pullout Celebration
Raw Video: Annual Empire State Building Run-Up
Man Killed in Courthouse Shootout
Air Force Airlines: Leaders Get Polished Service
