Updated from 4:06 p.m. EDT
Stocks in the U.S. slid Thursday following two days of gains in New York, as shares in
were weak throughout the session.
Dow Jones Industrial Average
sank 224.64 points, or 1.9%, to 11,431.43, and the
lost 23.13 points, or 1.8%, to 1266.06. The
was off 22.64 points, or almost 1%, at 2355.73.
While the market was in the red all day, selling picked up late after Moody's said it has placed the long-term ratings for
on review for a possible downgrade. Shares of American Express shed 4.2%.
One of the primary factors weighing on equities from the outset was insurer AIG, who lost $5.36 billion in the second quarter as the continuation of the weak U.S. housing market and disruption in the credit markets dragged down its results. The stock plunged 18%.
Retailers also reported their monthly sales results, and many of them fell short of estimates, including Wal-Mart, the largest chain-store operator in the world.
Wal-Mart's U.S. same-store sales, excluding fuel, were up 3% last month, but that missed expectations. Additionally, the company offered cautious comments for spending in August, and its stock fell more than 6%.
had a steeper-than-expected decline of 1.2% in its July comps, while
disappointed analysts with a 10.4% pullback.
exceeded forecasts with a 10% increase in same-store sales, and
had strong numbers.
had comparable-sales decreases that were on the soft side. The S&P Retail Index was down 2.1%.
was another drag, giving back 6% after agreeing to a more than $7 billion settlement with state and federal authorities regarding probes into the auction-rate securities market.
Initial jobless claims also rattled traders, with the government saying 455,000 first-time filings for unemployment insurance were submitted last week. That was 30,000 more than predicted and up 7,000 from the prior week.
As for earnings,
profits dropped roughly 28% owing to sluggish North American sales, while
topped analysts' quarterly earnings estimates.
Outside the stock market, oil futures added $1.44 to $120.02 a barrel. The dollar improved against major currencies other than the yen.
Turning to the fixed-income side, Treasury prices were much stronger, with the 10-year note up 1-5/32, lowering the yield to 3.92%. The 30-year bond was climbing 2-6/32 to yield 4.55%.
This article was written by a staff member of TheStreet.com.