Investors are putting the brakes on the market's recent rally, which gave the Dow Jones industrials seven straight days of gains through Wednesday, hitting another high for the year and matching its longest winning streak since July.
Analysts say the market has been running out of reasons to move higher and is now looking for more convincing signs of recovery in the economy before resuming its upward march.
The latest report on unemployment benefits failed to excite investors. The Labor Department reported before the market opened that first-time jobless claims fell 10,000 last week to 570,000, just shy of economists' expectations for 565,000.
Workers continuing to file for benefits, however, fell more than expected, declining to 6.13 million from 6.25 million in the previous week. It was the lowest level for continuing claims since early April. Economists had been expecting claims to total 6.2 million.
Meanwhile, a Commerce Department report showed the nation's economy shrank at a 1 percent annualized rate in the second quarter. The updated figure was unchanged from an earlier, preliminary reading on the nation's GDP, which measures the value of all goods and services produced within the U.S. Economists had been predicting the figure would be revised lower to a 1.5 percent decline.
Trading has been erratic over the past week, even amid data showing improvements in housing and consumer confidence. Investors are worried about extending the market's impressive spring and summer rally without signs of actual economic growth.
The Dow fell 70.21, or 0.7 percent, to 9,473.31. The Standard & Poor's 500 index fell 10.58, or 1.0 percent, to 1,017.54, while the Nasdaq composite index fell 27.87, or 1.4 percent, to 1,996.56.
Yesterday’s Top Performing Small Cap stock:
TIE Technologies, Inc. (Pink Sheets: TTCS) was a SmallCapVoice.com top performer closing up 16% on trading volume of 1,698 shares.
A New Audio Interview Featuring TIE Technologies, Inc. Executive Vice President, Graham Mew, is now at SmallCapVoice.com. The interview can be heard at http://smallcapvoice.com/blog/8-25-09-audio-interview-with-tie-technologies-inc-otcpk-ttcs.
TIE Technologies is a systems integration and telecommunications company focused on engineering and delivering innovative solutions for user's needs and challenges within the dynamic global voice, video and data communications markets. The company offers managed IT and telecommunication services to solve a myriad of complex client requirements. Services and solutions include out sourced and internal server, applications hosting, managed hosting and related systems management services, database hosting, content delivery networks, data broadcasting networks, and voice and video solutions providers. TIE Technologies (TIE) is traded on the Pink Sheets under the symbol "TTCS".
Today’s SmallCapVoice.com Hot Stock to Watch:
HearAtLast Holdings, Inc. (Pink Sheets: HRAL)
HearAtLast Holdings, Inc., a leading provider of suitable affordable solutions to clients with hearing needs in the billion dollar hearing loss market, announced that through the addition of Louis Isabella; CFO; and the Evans Martin group, the Company has identified several significant cost cutting measures.
The new direction of HearAtLast Holdings, Inc. sees dramatic reductions in operating costs across the board. Restructuring at the corporate level will enable HearAtLast to successfully reduce management monthly expenses by approximately $240,000 without diminishing the team or duties of management.
With the new revenue and community outreach model developed by Robert J. Oswald and Pierre LaFontaine now in place, the clinic operating expenses have also been reduced by $20,000-$30,000 per clinic or upwards of $500,000 annually moving forward. "These resources can now be channeled into marketing and brand awareness, let alone the bottom line," states Louis Isabella; CFO. "We as a company and management team have simply assumed more responsibility at all levels of the operation, thus creating a break-even point and profitability well ahead of previous forecasts thus increasing shareholder value."
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