Stocks Slide; JPMorgan Drags on Dow

Stocks opened lower Thursday after the Fed highlighted the weakness of the recovery in its latest statement. But a pair of better-than-expected economic reports helped curb the losses.

The Dow Jones Industrial Average dropped about 40 points at the open, after eking out a gain on Wednesday.

JPMorgan was the biggest drag on the Dow, while Microsoft was among the handful of Dow gainers.

Financials overall were one of the day's worst performers as worries about the financial-reform bill and another earnings downgrade weighed on the sector.

Rochdale analyst Dick Bove lowered his projection for Goldman Sachs earnings to $1.93 a share from his prior estimate of $2.93 a share, citing a variety of factors, including a slowdown in the economy and a hefty charge for a one-time bonus tax in London. Not only is the estimate a full dollar below his prior estimate, but it's less than half that of the mean estimate of $4.10 a share.

Jobless claims dropped by 19,000last weekto 457,000, much better than the 7,000 drop expected.

Meanwhile, orders for durable goods, long-lasting items like cars and appliances, fell for the first time in six months but the 1.1-percent drop was less than expected. Economists surveyed by Reuters had projected a 1.4-percent decline.

The Fed statement "confirms that the U.S. policy makers are worried about what's happening in Europe," Marco Annunziata, global head of economics, fixed income & FX research at Unicredit, told CNBC.

"They're worried about the European financial crisis and its impact on financial markets, but they're also very worried about the rush to fiscal austerity in several European countries," Annunziata said.

Apple shares rose as the iPhone 4, the fourth iPhone model in as many years, hit store shelves today.

Google won a victory after a federal judge tossed Viacom's $1 billion suit over copyrighted videos appearing on Google's YouTube video site.

Hasbro shares jumped after a report that Providence Equity Partners is in early talks for a leveraged buyout of the toy maker.

The Gulf of Mexico oil spill continued, with BP reverting to an earlier tactic of collecting oil from the ruptured well. As well as the environmental damage, the spill is also taking its toll of President Obama's approval rating, which fell to 45 percent, according to a recent poll.

Dell said it expects revenue to jump 14 to 19 percent in fiscal 2011 as both consumer and corporate spending improves.

Housing continued to weigh on the market, after builder Lennar reported a quarterly profit as the homebuyer tax credit wound down, but new orders slowed and cancellations rose. Shares fell 1.6 percent in premarket trading.

European stocks were lower with mining shares giving up early gains. The miners had initially been higher on hopes Australia's new Prime Minister, Julia Gillard, would soften plans to tax the sector. Asian markets closed mostly lower.

Elsewhere in earnings, ConAgra reported profit of 20 cents a sharethat missed analyst expectations, while McCormick also is scheduled to report. shares fell 1.4 percent in light premarket trading.

Oracle and Research In Motion are due to report after the closing bell.

Treasurys prices benefited from the weakness in futures, with the yield on the benchmark 10-year note dropping to 3.09 percent, its lowest since April 27, 2009, when it last traded under 3 percent. Treasurys lost some of their gains after the jobs report.

Oil prices fell to near $75 a barrel, while gold fell nearly 1 percent. Currency trading sawthe US dollar gaining against a basket of foreign currencies and the euro falling slightlyagainst the greenback.

Still to Come:
THURSDAY: 7-yr note auction; iPhone 4 on sale; Yahoo shareholders meeting; Earnings from Oracle and Research In Motion after the bell
FRIDAY: Final read on Q1 GDP; corporate profits; consumer sentiment; XTO shareholders meeting on Exxon buyout; Earnings from KB Home

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