Updated from 9:57 a.m. EST
Stocks in New York were again under assault Thursday as investors took in
earnings and adjusted to jobless claims and a Jobs-less
Dow Jones Industrial Average
was sinking 126 points at 8073, and the
was losing 17 points at 826. The
was down 22 points at 1468.
reported better-than-expected profit for the recent quarter but still reported higher credit costs. CEO Jamie Dimon said higher losses are likely if the economy deteriorates further.
JPMorgan, the first big U.S. bank to air it earnings, will be followed by
Citi is expected to post its fifth straight quarterly loss. Reports surfaced earlier in the week that the bank's agreement with
would be the first in a series of steps to essentially
Investors, skeptical about the ability of Citi and other large banks to sustain themselves without more government aid, were validated when
The Wall Street Journal
reported that the U.S. government was close to extending billions in additional aid to
as it swallows the acquisition of Merrill Lynch.
The market was bracing for bad news with quarterly results, but it's getting the worst side of things between the recent Citi and Bank of America news, says Marc Pado, U.S. market strategist at Cantor Fitzgerald.
This earnings season is about exposing how much of the so-called toxic assets still exist, says Pado. "The importance of it is that they're going to finally show their balance sheets and what needs to be done in the next few months," he says. "But the government backing of the banks -- and this week Bank of America -- tells the whole story that the government is not going to let
fail and assimilating these negative situations is imperative."
The Labor Department said Thursday that
initial claims for unemployment benefits
increased 54,000 to 524,000 for the week ended January 10 on a seasonally adjusted basis. The jobless claims figure was greater than the consensus of 501,000.
The Labor Department also said the
producer price index
, which measures the costs of goods before they reach consumers, retracted 1.9% in December, following a 2.2% decline in November and a 2.8% drop in October on a seasonally adjusted basis. Economists had predicted a 2% decline.
In other data, RealtyTrac reported Thursday that more than 2.3 million homeowners in the U.S. faced
foreclosure proceedings in 2008
, an 81% increase from 2007, and more than 860,000 properties were actually repossessed by lenders, more than double the 2007 level.
Stocks in New York ended Wednesday's session with steep losses as the market absorbed a plethora of dismal data -- including weaker-than-expected retail figures for December -- and punished financials.
After Wednesday's market close, Apple said
will take a medical leave of absence until the end of June and Chief Operating Officer Tom Cook will be minding the iPhone and Macintosh maker's day-to-day operations in the interim.
Meanwhile, software giant
is reportedly considering significant layoffs. According to
The Wall Street Journal
, the cuts could be announced as early as next week.
In commodities, oil was falling $1.86 to $35.42 a barrel, while gold was falling $2.30 to $806.50 an ounce.
As stocks were declining, longer dated Treasuries were rising. The 10-year note was adding 3.5/32 to yield 2.2%, the 30-year was up 27.5/32, yielding 2.9%.
The dollar was stronger against the euro, pound and yen.
Overseas, the FTSE in London and the DAX in Frankfurt were both edging lower Wednesday, Japan's Nikkei Hong Kong's Hang Seng ended with losses.
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