U.S. Stocks Open in the Hole

Stocks in New York staged a weak open Thursday, as the automakers continued to search for ways to placate Congress and a slew of companies announced layoffs.
Publish date:

Updated from 9:04 a.m. EST

Stocks on Wall Street staged a sour open Thursday, as the automakers continued to search for ways to placate Congress, a slew of big-name companies announced layoffs and European central banks cut interest rates to mitigate a deepening recession abroad.


Dow Jones Industrial Average

was falling 77 points to 8515, and the S&P 500 was down 9.6 points to 861. The


slipped 20 points to 1472.

On Wednesday, stocks fluctuated before ending higher as


(F) - Get Report


General Motors

(GM) - Get Report



petitioned Congress for a bailout. Investors also processed a series of economic data releases.

Ahead of the new session Thursday, the automakers are again in focus.


reported that management at GM and Chrysler were contemplating a prearranged bankruptcy as a means to get government funds.

Layoffs and salary reductions were dominating the day's early headlines. Executives at


(C) - Get Report

, along with director and senior adviser Robert Rubin, were willing to go without bonuses this year, according to a report by the

Financial Times


Swiss bank

Credit Suisse

(CS) - Get Report

announced plans to cut 5,300 jobs and said it expects to report a $2.5 billion fourth-quarter loss.

In other financial-sector news,

The Wall Street Journal

reported that credit card company

Capital One

(COF) - Get Report

intends to buy Chevy Chase Bank for $520 million in a cash-and-stock deal.

The bout of layoffs and tempered guidance was not confined to the financial sector. Telecom company


(T) - Get Report

announced workforce reductions of 12,000, or about 4% of its employees, while


(DD) - Get Report

set plans to cut 2,500 workers.

Software firm

Adobe Systems

(ADBE) - Get Report

reported preliminary fourth-quarter results that were ahead of expectations, but also announced plans for an 8% reduction in headcount.

Media concern


(VIA) - Get Report

also announced job cuts and said it would put a raise freeze on some senior-level positions.

In the pharmaceutical space,


(MRK) - Get Report

reaffirmed its 2008 earnings projections but projected 2009 results would fall short of analysts' current estimates.


Toll Brothers

(TOL) - Get Report

said its fourth-quarter loss narrowed year over year and said its revenue in the coming year would fall substantially from current levels.

In one bright spot, retail giant


(WMT) - Get Report

announced its same-store sales rose 3.4% in November.

Across the board, however, the

November same-store sales

picture was less encouraging.


(COST) - Get Report





Pacific Sunwear


were among companies to announce slackening sales.

Turning to economic data, the Labor Department said jobless claims for the week ended Nov. 29 fell 21,000 509,000. The result was better than economists' forecast of 540,000 claims for the week. Separately, the Census Bureau's October read on factory orders also is on the schedule.

As the financial crisis was felt overseas, the Bank of England cut its key interest rate by one percentage point to 2%, and the

European Central Bank

reduced its rate to 2.5% from 3.25%. France also announced a $33 billion economic stimulus plan.

Looking at commodities, crude oil was down 52 cents to $46.27 a barrel. Gold was falling 70 cents to $769.80 an ounce.

Longer-dated U.S. Treasury securities were rising in price. The 10-year note was up 10/32, yielding 2.63%, and the 30-year was adding 24/32 to yield 3.13%. The dollar was climbing vs. the pound but softening against the yen and euro.

Abroad, European exchanges, including the FTSE in London and the DAX in Frankfurt, were trading lower. In Asia, Japan's Nikkei and Hong Kong's Hang Seng finished on the downside.