Alexa
  • Directory of Taiwan

Wall Street falls after jump in jobless claims, Bernanke's comments on bank troubles

Wall Street falls after jump in jobless claims, Bernanke's comments on bank troubles

Stocks dropped sharply Thursday, breaking the Dow Jones industrials' four-day winning streak as investors fretted over a rise in unemployment claims and the prospect of more bank failures. The Dow fell 112 points.
Federal Reserve Chairman Ben Bernanke said in testimony to Congress that while large U.S. banks will likely recover from the recent credit crisis, other banks are at risk of failing. Three small U.S. banks have already failed since the summer, when the lending industry started losing billions of dollars as mortgage defaults soared.
"Implying that some banks may fail stirs concerns for any investor who's familiar with financial and economic history," said Hugh Johnson, chairman and chief investment officer of Johnson Illington Advisors. "Investors have been very edgy about credit market conditions and banks' financial conditions. Very edgy. And this doesn't remove that edginess."
Earlier, stocks had fallen in response to a Labor Department report that first-time unemployment claims rose last week by 19,000 to 373,000, the highest level since late January.
Scott Wren, equity strategist for A.G. Edwards & Sons, said he still believes there's less than a 50 percent chance of a recession, but that it's clear employers are cautious about hiring.
"To consistently see claims up near 400,000, that's pretty telling often-times of a recession," he said.
Following four straight days of gains in the Dow _ its longest run of gains so far this year _ the blue-chip index sank 112.10, or 0.88 percent, to 12,582.18.
Broader stock indicators also lost ground. The Standard & Poor's 500 index declined 12.34, or 0.89 percent, to 1,367.68, and the Nasdaq composite index lost 22.21, or 0.94 percent, to 2,331.57.
___
On the Net:
http://www.nyse.com
http://www.nasdaq.com


Updated : 2021-08-04 17:14 GMT+08:00