Stocks slump in early trading
Wall Street retreats as major companies announce job cuts, Big Three head to Capitol Hill
NEW YORK (CNNMoney.com) -- Stocks slipped Thursday morning as investors eyed mostly weak November sales results from the nation's retailers and a rash of job cuts at AT&T, DuPont and other companies.
The automakers were also in focus Thursday, with executives from the Big Three due to testify on Capitol Hill regarding a proposed $34 billion in bailouts.
The Dow Jones industrial average (INDU), the Standard & Poor's 500 (SPX) index and the Nasdaq composite (COMP) all declined modestly in the early going.
Stocks rallied Wednesday, with the Dow gaining 2%. The S&P 500 added 2.6% and the Nasdaq composite jumped 2.9%. But the mood appeared to turn dour Thursday morning.
Jobless claims: The Labor Department reported 509,000 initial jobless claims for the week ended Nov. 29. This is better than the 540,000 claims that were projected in a consensus of economist opinion compiled by Briefing.com. It's also better than the 529,000 claims from the prior week.
The government report comes a day after payroll-processor ADP said private-sector employment fell by 250,000 jobs in November.
Job cuts: The telecom giant AT&T (T, Fortune 500) said it would cut 12,000 jobs, or 4% of its total workforce, citing "economic pressures, a changing business mix and a more streamlined organizational structure."
DuPont, the chemical conglomerate, said it would cut 2,500 jobs, primarily in "businesses that support the motor vehicle and construction markets in Western Europe and the United States."
Retailers: Wal-Mart (WMT, Fortune 500), the world's leading retailer, reported a 3.4% gain in same-store sales for its U.S. stores, not including fuel sales.
"They're doing excellent in this environment," said Dave Rovelli, managing director for Canaccord Adams. "That's a positive for Wal-Mart, but I think it's a negative for the economy."
Other major retailers reported their November same-store sales Thursday. Same-store sales are a key measure of performance in the retail industry.
Todd Leone, head trader at Cowen & Co., said that expectations are exceedingly low for the holiday shopping season.
"People are expecting the worse," said Leone. "People are expecting Christmas to be absolutely horrible."
Costco Wholesale (COST, Fortune 500) reported a 3% decline excluding gasoline and foreign exchange.
Economists from Thomson Reuters expect an industry-wide dip of 2.4%, which would be the worst performance since record-keeping began in 2000.
World markets: The Bank of England said it was cutting its key bank rate by 1% to 2%. The European Central Bank cut a key interest rate by 0.75% to 2.5%.
Earlier in the day, major markets in Europe advanced after Sweden's central bank cut its key interest rate by a record 1.75 percentage points to 2%. But in midday trading, European stock indexes in London, Paris and Frankfurt slipped following the additional rate cuts.
Asian markets finished lower, with the Nikkei declining 1% and the Hang Seng slipping less than 1%.
Big Three: The chief executives of Detroit's Big Three automakers are due to appear before a Senate committee to request financial aid to stay in business.
General Motors (GM, Fortune 500), Ford (F, Fortune 500) and Chrysler want a combined $34 billion loan package. On Wednesday, the United Auto Workers said it will work with the Big Three to bring down costs, improving their chances of getting a government bailout.
Leone of Cowen & Co. said that government refusal of a loan for the Big Three could drag down the markets.
Companies: Luxury homebuilder Toll Brothers (TOL, Fortune 500) reported a loss of nearly $80 million, or 49 cents per share, including about $175 million in pre-tax writedowns.
But without the charges, the company reported a profit of 23 cents per share.
Oil and currency: Oil slipped 60 cents a barrel to $46.19 on the New York Mercantile Exchange. The dollar slipped against the yen, but rose versus the euro and the British pound. 
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