Wall Street slid into bear territory yesterday with Dow Jones down more
than 340 points as disappointing jobless and retail data left investors in doubt
of a come-back in US economy.
Major US retailers reported poor August sales. While Wal-Mart Stores Inc.,
the world's largest retailer, beat expectations due to its discounts, many
retailers said consumers cut spending last month because of higher gas and food
prices. Analysts believed that consumers are spending mostly on essentials, and
have put their discretionary buying on hold.
Also yesterday the US Labor Department reported that initial jobless benefits
claims rose 15,000 to 444,000 last week, which was the first rise in four weeks.
Economists had expected the number to drop slightly to 420,000. The report made
investors pessimistic on the government's August employment report which is
scheduled to be released on Friday.
The drop in crude oil prices failed to lift the stocks. Light, sweet crude
for October delivery fell US$1.46 to settle at US$107.89 a barrel on the New
York Mercantile Exchange as a less-than-expected drop in the US gasoline
stockpiles signaled a cooling domestic demand for fuel. Energy shares fell.
The Dow Jones slid 344.65 to 11,188.23. Broader indexes also tumbled. The
Standard & Poor's 500 index fell 38.16 to 1,236.82 and the Nasdaq dropped
74.69 to 2,259.04.
