Stocks continue to linger in the red in mid-afternoon trading on Thursday, selling off after today's new financial regulation proposals and another lackluster batch of economic reports. The major averages are all in negative territory, posting losses for the week.
The markets came under pressure in morning trading amid concerns about remarks from President Barack Obama, who proposed fresh regulations for the financial industry that he said are aimed at protecting the consumer and the economy.
Obama said the new rules he is proposing would close loopholes that allowed firms to trade in risky products without oversight, strengthen capital and liquidity requirements to make the system more stable and ensure that the failure of any single institution will not pose a risk to the financial system as a whole.
Also this morning, traders were presented with another mixed batch of economic data, which was unsuccessful in indicating a clear direction for the U.S. economy.
The Federal Reserve Bank of Philadelphia released a report on showing a bigger than expected slowdown in the pace of growth in regional manufacturing activity in January, although the manufacturing sector continued to show improvement for the fifth consecutive month.
In a separate report, the Conference Board revealed that December's leading economic indicators rose for the ninth consecutive month, climbing by a bigger margin than economists had anticipated.
Meanwhile, the Labor Department reported that first time claims for unemployment benefits unexpectedly rose in the week ended January 16th, although the headline figure was significantly impacted by seasonal factors.
Earnings also garnered market attention today, as financial services firm Goldman Sachs (GS) reported a profit for the fourth-quarter compared to a loss in the previous year, helped by a surge in revenues at its investment banking as well as trading and principal investments operations. The firm's bottom line trounced analyst estimates, while revenues fell just short of expectations.
Google (GOOG), Advanced Micro Devices (AMD), American Express (AXP) and Capital One (COF) are among the major companies that will release their results after the conclusion of today's trading session.
The major averages have seen some upside in recent trading, recovering partially from their afternoon lows, although they remain firmly negative. The Dow is currently down 176.77 at 10,426.38, the Nasdaq is down 15.82 at 2,275.43 and the S&P 500 is down 15.77 at 1,122.27.
Dow Components
All but one of the Dow components are posting losses in mid-afternoon trading, contributing to the triple-digit pullback by the blue chip index.
JP Morgan Chase (JPM) is one of the leading decliners in the Dow, posting loss of 4.6 percent. Shares of the financial giant are poised to end the session at their lowest closing price in just over a month as traders react negatively to President Obama's reform proposals.
Bank of America (BAC) is also seeing a hefty loss, further reflecting today's weakness in the financial sector. The stock is currently down by 4.2 percent, on pace for its worst closing level in roughly three weeks.
Alcoa (AA), Caterpillar (CAT), DuPont (DD) and Pfizer (PFE) are also moving notably lower, while McDonald's (MCD) is bucking the downtrend in the blue chip index, rising by 0.6 percent.
Sector News
Steel stocks remain some of the day's weakest performers, prompting a 5.2 percent loss by the NYSE Arca Steel Index. With the decline, the index is on pace to end the session at its lowest level in roughly one month's time.
Gold stocks are also retreating, dragging the NYSE Arca Gold Bugs Index down by 3.3 percent. The drop has the index poised to set a two and a half month closing low amid another pullback in the price of the precious metal in commodities trading.
Significant weakness is also visible among defense stocks, with the Philadelphia Defense Sector Index posting a loss of 1.9 percent. The index is being dragged lower by shares of GenCorp Inc. (GY), which are down by 3.8 percent, on pace for a three and a half month closing low.
Housing, healthcare, oil and commercial real estate stocks are also under pressure, while electronic storage stocks continue to post strong gains, with the NYSE Arca Disk Drive Index up by 2 percent. Despite the advance, the index remains rangebound.
In Focus: Economic News, Earnings
As mentioned above, the Philadelphia Federal Reserve released a report showing that its index of activity in the Philadelphia-area manufacturing sector fell to 15.2 in January from a revised 22.5 in December, although a positive reading continues to indicate growth in the sector. Economists had been expecting a more modest decrease by the index to a reading of 18.0.
Separately, the Conference Board released its report on leading economic indicators in the month of December, showing that its leading indicators index increased by 1.1 percent following an upwardly revised 1.0 percent increase in November. Economists had expected the index to increase by 0.7 percent compared to the 0.9 percent growth originally reported for the previous month.
Earlier, the Labor Department reported that initial jobless claims rose to 482,000 from the previous week's revised figure of 446,000. The increase came as a surprise to economists, who had expected jobless claims to edge down to 440,000 from the 444,000 originally reported for the previous week.
While jobless claims rose to the their highest level since mid-November Peter Boockvar, equity strategist for Miller Tabak, noted, "A Labor Department official did say that a backlog in the processing of claims due to the Christmas and New Year's holidays was a factor in the surge this week, but it wasn't quantified."
"Also, some states had to estimate claim filings due to the MLK holiday," he added. "Thus, take today's initial claims data with a grain of salt."
In earnings news, Goldman Sachs reported fourth-quarter net income of $8.20 per share, blowing away Wall Street estimates of $5.20 per share. Net revenues, including interest income, came in at $9.62 billion for the quarter, just short of the $9.65 billion expected for the quarter.
Rail transport firm Union Pacific Corp. (UNP) reported fourth quarter net income of $1.08 per share, topping the $1.04 per share expected by analysts. Meanwhile, revenues missed the mark, coming in at $3.75 billion, just short of the $3.77 billion forecast.
Other Markets
In overseas trading, stock markets across the Asia-Pacific region were mixed on Thursday. Japan's benchmark Nikkei 225 gained 1.2 percent, while Hong Kong's Hang Seng Index sank by 2 percent.
Meanwhile, the major European markets all finished notably lower on the day. The U.K.'s FTSE 100 fell by 1.6 percent, while the French CAC 40 Index and the German DAX Index declined by 1.7 percent and 1.8 percent, respectively.
In the bond markets, treasuries have turned higher amid the pullback on Wall Street. Subsequently, the yield on the benchmark ten-year note is trading at 3.603 percent, falling by 5.6 basis points.
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May 22, 2026 14:46 ET Minutes of the latest Fed policy session was the highlight of the week along with survey data on the U.S. housing market. In Europe, survey data signaled the trends in the euro area private sector. Further, consumer price inflation data from the U.K. was in focus. In Asia, various economic indicators from China drew attention to the health of the economy.