Stock Market Today: Poor Labor and Manufacturing Data Sends the Markets South

Here's what's making headlines in the stock market today.

  • Jobless claims rise again- A higher number of people filed for their first week of unemployment benefits last week, a sign that the job market is not improving as hoped. For the week ended August 18 372,000 filed for unemployment, up 4,000 from the previous week, the Department of Labor said Thursday. Economists had expected initial claims to be 368,000. As of the July jobs report, 12.8 million people were counted as unemployed and about 5.59 million people received some kind of state or federal benefit in the week ended Aug. 4. "Jobless claims continue to indicate ... a sluggish labor market," Peter Cardillo, an economist at Rockwell Global Capital in New York told Reuters. "The numbers also strengthen the hand of the Fed to aid the economy with more stimulus."
  • Global manufacturing slumps- The flash manufacturing Purchasing Managers Index for the U.S. edged slightly higher to a 51.9 reading in August from 51.4 in July, according to Markit. The August reading marked the first monthly increase in five months, but it was the third weakest result since the manufacturing sector stopped shrinking in October 2009. New export orders continue to be below the 50 mark, indicating contraction, but output and new orders rose. Also causing concerns is the HSBC Flash China manufacturing PMI which fell to 47.8 for August, its lowest level since November and well down from July's final figure of 49.3.
  • Housing continues to show improvement- Sales of new U.S. homes rose more than projected in July to match a two-year high, a sign the industry that helped cause the recession is recovering. Purchases of new single-family homes in the U.S. climbed to an annual rate of 372,000 in July from 359,000 in June, the Commerce Department said Thursday. Economists had expected new home sales to rise to a seasonally adjusted 365,000 last month. Even though sales of new houses increased 25%from a year ago, the median price for a new house decreased 2.5% in July from the same month last year. Overall faster sales and a slower rate of construction resulted in a supply of 142,000 new houses on the market at the end of July, the fewest in data going back to 1963.
  • Hewlett-Packard Co. (NYSE: HPQ) posts record loss- HP continues the tech sector's weak earning season as it announced a quarterly loss of $8.9 billion, or $4.49 per share, versus a profit of $1.93 billion, or 93 cents per share in the same period last year. The loss included a $9.2 billion write-down related to HP's 2008 acquisition of Electronic Data Systems. Earnings excluding costs were $1 a share and sales were $29.7 billion in the third quarter ended July 31, matching analysts' predictions. The company cut the high end of its full-year forecast for profit excluding some items to $4.07 a share, from $4.10, missing the average $4.08 analyst estimate.

    HP's PC segment, which CEO Meg Whitman is trying to revive, saw sales fall 10% echoing the results Dell Inc. (Nasdaq: DELL) reported earlier this week. "We think that both Dell and HP face an uphill task in the PC market, which is affected both by weak macro and changing consumer preference with no credible tablet product," BMO Capital Markets analyst Keith Bachman wrote in a note to Reuters. HPQ stock is down near 7% in early trading.

  • Big Lots Inc. (NYSE: BIG) shares plunge- Big lots is today's biggest loser as the discount retailer reported its net income fell 38% from a year ago. It also slashed its 2012 profit outlook to $2.80 to $2.95 per share, down from its previous prediction of $3.25 to $3.45 per share. BIG stock is down over 21% in early trading.

The Dow Jones today was down 65 points, or 0.49%, and the S&P 500 was down 5.33 points, or 0.38% in early trading.

Related Articles and News: