Stocks Slide as Data Disappoint Traders

The market, following Wednesday's late rally, has a lower open as second-quarter GDP and weekly initial jobless claims come in worse than expected.
Publish date:

Updated from 7:43 a.m. EDT

Premarket futures were indicating a drop at the open for U.S. stocks Thursday, as a report on the overall health of the domestic economy came in weaker than expected and first-time filings for jobless claims ballooned.

Futures for the

S&P 500

were losing 8 points to 1277 and were 7 points under fair value.


futures were falling 13 points at 1843 and were 14 points below fair value.

Traders were in a holding pattern ahead of the morning's economic data, but when the figures were released, the mood took a turn for the worse.

The big number came from the Commerce Department, who said second-quarter gross domestic product rose at a 1.9% annual rate. While that exceeded the first-quarter pace, it still fell short of the 2.3% consensus estimate.

Another disappointment was registered with the Labor Department's weekly initial jobless claims. According to the government, 448,000 claims were filed last week, more than 50,000 more than had been anticipated.

On Friday, the monthly employment report, always a key economic indicator, will be released.

The end of the prior session saw the market rally in the afternoon even as it faced an increase in crude oil prices, after the government signed into law a housing-relief bill and Automatic Data Processing released stronger-than-expected employment data.

After the close, coffee-shop operator


(SBUX) - Get Report

missed analysts' estimates



(V) - Get Report

, on the other hand, delivered

strong results

on the strength of its debit-card business.

Also showing resilience was media company and member of the

Dow Jones Industrial Average


(DIS) - Get Report

, which

beat Wall Street expectations


A swathe of more than 100 additional earnings statements were due out before the start of the new session.

Dow stock and oil company


(XOM) - Get Report

announced a 14% increase in profits on the record oil prices of the past quarter. Gold miner



announced a 22% year-over-year increase in net income.

Among retailers, pharmacy


(CVS) - Get Report

reported an earnings increase that left its financial results in line with expectations.

Traders likewise heard from consumer goods providers such as tobacco concern


(MO) - Get Report

, food conglomerate


(UL) - Get Report

and cereal maker


(K) - Get Report

. Altria and Unilever both said profits declined from a year ago, while Kellogg announced rising income thanks to price increases that counteracted rising food-input costs.

Communications-technology name



announced an unexpected profit.

Elsewhere, drugmaker


(AZN) - Get Report

said earnings were up 13% year over year and issued a positive full-year profit outlook. Health insurer



reported an increase in second-quarter profit thanks to increased membership and higher premiums.

In the financial space, credit card company


(MA) - Get Report

said it lost $747 million in the second quarter thanks to a $1 billion after-tax charge stemming from a settlement with rival card company

American Express

(AXP) - Get Report


Away from earnings, pharmaceutical concern

Bristol-Myers Squibb

(BMY) - Get Report

announced its intention to buy biotech firm



, in which it already owns a minority stake, for $4.5 billion, or $60 a share, a 30% premium over its last closing price.

In commodities, the price of crude oil was falling 68 cents to $126.09. Gold for December shipment was adding $5.90 to $918.20.

As for Treasuries, the 10-year note was down 1/32, yielding 4.05%, and the 30-year was down 1/32 to yield 4.65%. The dollar was falling vs. the euro, the yen and the pound.

Abroad, London's FTSE, the DAX in Frankfurt, the Nikkei in Japan and the Hang Seng in Hong Kong were all edging higher.