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Wall Street Slides Again

The major indices in New York close lower Thursday, with the S&P 500 falling below 900.

Updated from 4:11 p.m. EDT

The major indices in New York closed lower Thursday, with the

S&P 500

falling below 900 as the latest unemployment numbers and a credit warning on the U.K. offset a warm reception to the first pair of venture capital-backed IPOs in months.


Dow Jones Industrial Average

fell 129.91 points, or 1.5%, to 8292.13, while the

S&P 500

lost 15.14 points, or 1.7%, to 888.33. The


shed 32.59 points, or 1.9%, to 1695.25.


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TheStreet Recommends

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were the worst performers on

the Dow

, losing 4.1% and 4.7%, respectively.

General Electric

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Home Depot

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lost 3.4% and 3.9%.

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General Motors

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surged 32.4%, however, amid reports that it arrived at

a tentative agreement

with the United Auto Workers union and the government, and that the U.S. Treasury is prepared to give the company's GMAC financing unit at least $7 billion in aid.

A report from the Department of Labor brought less cheer to investors. The department said new weekly jobless claims fell to 631,000 from an upwardly revised 643,000 the week prior and vs. expectations for 625,000.

"The current reading is in territory that suggests that while job losses are ebbing, they remain high," writes Tony Crescenzi, chief bond strategist at Miller Tabak and a

contributor. "Job losses like that could lead to increases of two- or three-tenths per month in the unemployment rate."

Perhaps the more troubling figure is continuing claims, which rose to 6.662 million from 6.587 million. Continuing claims offer "glaring evidence of the difficulties that workers are having in finding new employment," writes Crescenzi, although he points out that the increase of 75,000 is the smallest in about three months.

"It used to be good enough if things were declining at a slower rate, but now the market is demanding a little bit more," says Bill Stone, chief investment strategist at PNC Wealth Management. "It wants to also exceed expectations, and coming 30% off the lows, that doesn't surprise me. Things get a little demanding."

Unfortunately, he says, "you'd have to be oblivious not to expect that you're going to see more pressure on those numbers after what has gone on with Chrysler and will continue to go on with GM."

The domestic data followed a warning from Standard & Poor's that the U.K. could lose its AAA credit rating. The agency cut its outlook on Britain to negative from stable, sending the FTSE in London lower by 2.9% and discouraging stocks globally.

Stocks in the U.S. closed lower Wednesday after the

Federal Reserve Open Market Committee

balanced positive comments about the housing sector and consumer spending with a more pessimistic view of production and the labor markets.

Leading indicators

rose 1% in April, slightly more than expected, after a decline of 0.2% the month prior. The Philadelphia Fed index also improved, although not as much as anticipated, to negative 22.6 from negative 24.4.

On the brighter side, Wall Street welcomed its second initial public offering in two days -- the first two venture-backed IPOs in nine months.

Open Table


priced its shares at $20 each

, higher than expected. It follows


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, which rose 9.6% in its first day of trading Wednesday.

Open Table shares rose 59.5% to $31.89 on their first day, Solar Winds rose 0.3% on its second day of trading.

In other news,

Bank of America

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wants to pay back $45 billion it received in bailout money from the U.S. Treasury, according to the

Financial Times

. The bank has been

raising money

to satisfy the results of the so-called stress tests and is currently more than halfway through that $33.9 billion obligation.

Bank of America shares fell 0.7% to $11.41, while the KBW Bank Index lost 1.7%.

Fifth Third Bancorp


lost 9.9% to $6.95, and

Regions Financial

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gave up 16.2% to $4.10 on Thursday as they moved to raise capital.


Barnes and Noble

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surprised Wall Street with a less severe than expected loss. It also raised its outlook. Shares rose 3% to $24.60.

The dollar was recently stronger vs. the yen, but weaker against the pound and euro. Gold gained $13.80 to settle at $951.20 an ounce, while crude oil futures fell 99 cents to $61.05 a barrel.

Longer-dated Treasuries reversed course at midday. The 10-year was lower by 1-10/32, to yield 3.35%, while the 30-year was down 2-26/32, to yield 4.31%.

Treasuries turned lower after the New York Fed reported that it purchased only $7.4 billion of $45.7 billion that dealers had offered as part of a series of planned auctions.