Stocks ended lower Thursday as Wall Street assessed mixed economic data from the U.S. and China and weighed earnings reports from Johnson & Johnson (JNJ) - Get Report, Bank of America (BAC) - Get Report and Morgan Stanley (MS) - Get Report.
The Dow Jones Industrial Average finished down 135 points, or 0.5%, to 26,734, and the S&P 500 dropped 0.34%.
The number of Americans filing for unemployment insurance since the coronavirus pandemic in March neared 50 million as first-time jobless claims continued to rise, weekly government figures released Thursday showed.
Retail sales rose 7.5% in June, the second straight month of sharp gains, but economists have expressed concern that next month could be weaker as a surge in coronavirus cases has many states and businesses again locking down.
"We’re seeing a bit of a reality check compared to last month’s record. Though this is a solid read, the unknown is how much more room does retail spending have to run if shutdowns persist," said Mike Loewengart, managing director of investment strategy at E-Trade.
"As stimulus money for many Americans is coming into question, we could see some tough times ahead, and it remains to be seen how it will effect consumer spending in the long run. With coronavirus cases ticking up, the market could be in limbo until we get a clear sign on unemployment aid and some meaningful news on the vaccine front," Loewengart added.
In China, the world's second-largest economy, growth returned in the second quarter but signs of weakness remained, particularly in retail sales.
The Shanghai Composite fell 4.5% Thursday - the worst drop since the coronavirus pandemic began - following the data and as tensions increased between Washington and Beijing.
Bank of America's (BAC) - Get Report second-quarter profit beat analysts' forecasts but fell sharply from a year earlier. The bank warned it was bracing for substantial loan losses amid the coronavirus pandemic, which has upended the banking and lending sector.
Johnson & Johnson JNJ posted stronger-than-expected second-quarter earnings and boosted its full-year profit guidance while confirming its goal of advancing the development of a coronavirus vaccine.