Investors wary of jobless numbers
by Associated Press
Published: January 7,2010
Tags: stocks and bonds
NEW YORK (AP) — Stocks slipped early Thursday as the dollar rose and as investors prepared for the government’s monthly unemployment report Friday.
The modest losses came as the government reported a slight rise in new claims for unemployment benefits. The Labor Department said initial claims for jobless benefits rose by 1,000 to a seasonally adjusted 434,000 last week. That was lower than the 447,000 analysts expected, but stock traders remain wary ahead of Friday’s report on December employment. Analysts expect the government to report the unemployment rate rose last month.
Upbeat December retail sales reports and increased forecasts lifted some retailers. Shoppers spent a little more over the holiday season, though consumer spending is expected to remain weak as unemployment remains high and credit remains tight.
Warehouse club operator Costco Wholesale Corp., The Buckle and Children’s Place Retail Stores Inc. all reported monthly sales increases.
Sears Holdings Corp., which operates Kmart and Sears, Roebuck and Co., eked out a small gain and offered fourth-quarter guidance that’s sharply above Wall Street estimates. Others, including Macy’s Inc. and Limited Brands, raised their profit forecasts.
In the first half hour of trading, the Dow Jones industrial average fell 27.96, or 0.3 percent, to 10,545.72. The broader Standard & Poor’s 500 index fell 2.88, or 0.3 percent, to 1,134.26, and the Nasdaq composite index fell 8.33, or 0.4 percent, to 2,292.76.
Bond prices were mixed. The yield on the benchmark 10-year Treasury note, which moves opposite its price, was flat at 3.83 percent from late Wednesday.
The dollar rose against other major currencies, while gold prices fell. A gain in the dollar weighs on commodity prices by making them more expensive for overseas buyers. That hurts energy and materials companies.
After a big gain in stocks Monday on stronger global manufacturing data, trading has been subdued.
The cautious tone seen Tuesday and Wednesday comes as investors await the December employment report. Economists forecast the unemployment rate rose to 10.1 percent from 10 percent and that employers shed 8,000 jobs.
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