Well, despite a few bright spots in the world’s largest economy, reports released throughout the week continued to indicate that while a recovery may be in the works there are still many problem areas which need to be tackled before the U.S. economy is fully healthy again. As a result, stock markets fell for the second week in a row.
The Dow Jones Industrial Average closed Friday’s trading session down 21.61 points, or 0.23%, to 9487.67. For the week, the index slipped 177.52, or 1.84%. While the Standard & Poor’s 500 slid 4.64, or 0.45%, to 1025.21 on Friday and for the week, the S&P 500 declined 19.17, or 1.84%, losing 4.03% in the past two weeks. Among other indices, the NASDAQ Composite closed Friday down 9.37 points, or 0.46%, to 2048.11, losing 42.81, or 2.05%, for the week.
Below is a look at what happened during the week…
Monday: As expected, not much activity.
Tuesday: The Conference Board said its Consumer Confidence Index fell to 53.1 in September from an upwardly revised 54.5 in August. Economists were expecting a reading of 57.
Meanwhile, U.S. home prices as measured by the S&P Case-Shiller 20-city home price index fell by a smaller than expected 13.3% over the year to a level of 144.23 Economists were expecting prices to fall by a larger 14.2% over the year. Over the month, the 20-city home price index rose 1.6% after rising 1.4% in June. The 10-city index rose by 1.7% in July and 12.8% over the year to 155.85.
Wednesday: According to the ADP report, companies in the U.S. cut 254,000 jobs this month, more than forecasted. The estimated drop, which was the smallest since July 2008, compares with a revised 277,000 decline the prior month, figures from ADP Employer Services showed. The ADP report was forecast to show a decline of 200,000 jobs, according to the median estimate of 33 economists in a Bloomberg survey. Projections ranged from decreases of 300,000 to 133,000.
U.S. GDP dropped $26.8 billion in the second quarter to $14.15 trillion, contracting 0.7%. Economists expected 1%.
The Chicago Purchasing Managers Index fell to 46.1 in September rather than rising to the 52 that economists expected.
Thursday: According to the U.S. Labor Department, the number of Americans filing first-time claims for jobless benefits rose more than forecast last week, a sign companies are still cutting workers as the economy pulls out of the recession. Applications rose by 17,000 to 551,000 in the week ended Sept. 26, from a revised 534,000 the week before, Labor Department data showed. The total number of people collecting unemployment insurance fell in the prior week to 6.09 million, the least since April.
The Institute of Supply Management’s manufacturing index fell slightly in September to 52.6, yet still marked the second month of expansion for the manufacturing industry. Economists were expecting ISM to rise to 54.0 from the 52.9 reported in August.
The National Association of Realtors reported that the pending-home-sales index rose 6.4% in August to its highest level since March 2007, indicating improvements in the real estate sector.
Friday: The U.S. Labor Department reported that employers cut another 263,000 jobs in September and the unemployment rate rose to a 26-year high of 9.8% The number of unemployed – officially at 15.1 million – is greater than the population of all but four states. The proportion of people who have been searching for work for longer than half a year rose to 35.6% of the unemployed, from a third of the work force in August. The dismal state of the job market led to a decline of 571,000 in the labor force, a sign that discouraged workers have given up looking for work entirely.
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