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Stocks lose ground after Fed Chairman Bernanke offers no new stimulus policies in speech
NEW YORK (AP) ' Stocks slid Thursday after Federal Reserve Chairman Ben Bernanke offered no hints that the central bank may take steps to help the ailing economy.
Some investors have anticipated that the Fed will soon take additional steps to stimulate the economy at its two-day meeting that begins Sept. 21.
The Dow Jones industrial average was down 71 points, or 0.6 percent, to 11,344 at 1:45 p.m., 15 minutes after Bernanke started speaking. The Dow and other indexes moved between small gains and losses in earlier trading.
The Standard and Poor's 500 index fell 9, or 0.7 percent, to 1,190. The Nasdaq composite dropped 12, or 0.5 percent, to 2,537.
Cisco Systems led the 30 Dow stocks with a 2 percent gain. JPMorgan Chase, Bank of America Corp and Boeing each fell 3 percent to pull the average lower.
Bernanke's was one of two speeches that will be closely watched on Wall Street Thursday. President Obama will lay out his jobs plan at a joint session of Congress tonight. He is expected to announce a $300 billion package that includes tax cuts, additional state aid and spending on infrastructure.
Investors received mixed economic data before the market opened. First-time applications for unemployment benefits rose last week to 414,000. Economists had expected 405,000. The prior week's estimate of new claims was also revised higher.
The weekly report on unemployment applications is an important economic signal for investors. Rising claims can add to concerns that the job market is stalled and the U.S. economy is headed for another recession. Applications need to fall below 375,000 to indicate sustainable job growth. Last week the government reported there was zero job growth in the U.S. economy in August.
Not all of the economic news Thursday was negative. American exports of cars, airplanes and other goods reached an all-time high in July, the Commerce Department reported. Economists said the jump in exports suggest future growth in the U.S. economy.
"The market is sitting around and trying to piece it all together, "said Rob Stein, the founder and global head of asset management at Astor Asset Management. "For all the volatility that we've had recently, the market is going nowhere."
In corporate news, Google rose 0.1 percent, to $534.89, after it announced that it will acquire dining guide Zagat.