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10A – Daily News – Friday, August 20, 2010 NEW YORK (AP) — Stocks tumbled Thurs- day after two disap- pointing economic reports renewed investors’ concerns about the pace of the recovery. Stocks drop as jobless claims rise unexpectedly Wall Street nomic readings. The Dow Jones industrial average fell 144 points. All the major stock indexes fell more than 1 percent. Interest rates also fell sharply as investors moved back into the safety of Treasury bonds. The Labor Depart- ment said initial claims for unemployment bene- fits rose unexpectedly last week and the Feder- al Reserve of Philadel- phia said manufacturing activity in the mid- Atlantic region has dropped during August. ‘‘The Philly Fed num- ber was just awful,’’ said Randy Frederick, direc- tor of trading and deriv- atives at Charles Schwab. ‘‘The jobs number was bad, but not as far off the mark as the Philly number.’’ The pair of economic reports followed news that Intel Corp. was acquiring McAfee Inc. The deal, valued at $7.68 billion, was not enough to offset the impact of the weak eco- The reports are the latest in a months-long string of conflicting readings on the econo- my. The reports have shown the pace of a rebound is slowing and that companies are skit- tish about adding new workers. That has hurt stocks on some days in recent weeks. It has also raised fears about the economy falling back into recession. At the same time, corporate announce- ments, including earn- ings reports for the past six weeks, have largely showed companies are doing well. There has also been a spate of acquisitions announced. Mergers and acquisi- tions activity is often considered a positive sign because it means companies are willing to expand their businesses and are confident their prospects are improving. The Dow fell 144.33, or 1.4 percent, to 10,271.21. All the 30 Dow stocks fell, only the ninth time that has happened this year. The Standard & Poor’s 500 index fell 18.53, or 1.7 percent, to 1,075.63, while the Nas- daq composite index fell 36.75, or 1.7 percent, to 2,178.95. About four stocks fell for every one that rose on the New York Stock Exchange, where con- solidated volume came to 4.4 billion shares, up from Wednesday’s 3.8 billion. Volume has been par- ticularly light in recent weeks, even by summer standards. Many traders are on vacation, but oth- ers are so uncertain about the direction of the economy that they’re staying away from any big moves. Bond prices rose after the weak jobs and manu- facturing reports. Investors often move into the safety of gov- ernment bonds when there are signs the econ- omy is not strong. The yield on the 10-year Treasury note, which moves opposite its price, fell to 2.58 percent from 2.64 percent late Wednesday. Its yield is often used to help set interest rates on mort- gages and other con- sumer loans. Joe Benanti, manag- ing director at Rosen- blatt Securities, said low volume likely added to the sell-off. It’s ‘‘probably taking trading a little to an extreme, more than it should,’’ Benanti said. The Labor Depart- ment said initial claims for unemployment bene- fits rose by 12,000 to 500,000 last week from an upwardly revised 488,000 a week earlier. Economists polled by Thomson Reuters fore- cast claims would fall slightly. It was the fourth rise in claims in the past five weeks and sent them to their high- est level since Novem- ber. High unemployment is considered the biggest hurdle to a stronger recovery because people worried about jobs have scaled back their spend- ing. Consumer spending accounts for the bulk of the country’s economic activity. The Philly Fed manu- facturing survey was negative 7.7 for August after a reading of posi- tive 5.1 last month. Economists were expect- ing the index to rise this month. Any reading above zero indicates growth in the sector. It was an especially sobering report because manufacturing activity early this year had shown the most consis- tent signs of growth. The report is ‘‘saying the manufacturing pop has run out of steam,’’ said Jim Peters, CEO of Tactical Allocation Group. The lift the econ- omy got from compa- nies replenishing inven- tories is over and sales have not picked up enough to maintain those levels, Peters said. A report on future Barber Shop $ Cheers 600 Open 6 days 570-2304 259 S. Main St. Tractor Supply Center China Buffet CHINESE RESTAURANT Open 7 Days A Week Sunday Buffet Special $ 9.99 COUPON China Buffet Lunch Dinner $9.99 $6.99 Monday - Saturday 343 S. Main St. Red Bluff 530-529-5888 (No Checks) 10 % off COUPON on dinner only (everyday) Expires 8-31-10 COUPON Senior Cuts Recently expanded and moved near Bidwell Elementary License # 525405817 (530) My qualifications include: B.A. in Elementary Education and experience teaching grades K-8. Accepting state pay programs & cash pay, etc. 209-8743 economic activity also fell short of expecta- tions. The Conference Board’s index of leading economic indicators rose 0.1 percent last month after falling a month earlier. Econo- mists had expected the index to rise 0.2 percent. The index tries to pre- dict economic activity over the next three to six months, so a rise in the index would indicate the economy is likely to grow during the second half of the year. Chip maker Intel is buying computer-securi- ty software maker McAfee in an all-cash deal for $48 per share. McAfee shares surged $17.09, or 57.1 percent, to $47.02. Intel shares fell 61 cents, or 3.1 per- cent, to $18.98. In other corporate news, Sears Holdings Corp. reported its sec- ond-quarter loss was cut in half as profit margins improved at its Kmart chain. But revenue at stores open at least a year, a key measure of strength in the retail industry, fell during the quarter. Sears shares dropped $5.36, of 8 per- cent, to $61.89. Overseas, Britain’s FTSE 100 fell 1.7 per- cent, Germany’s DAX index fell 1.8 percent, and France’s CAC-40 dropped 2.1 percent. Japan’s Nikkei stock average rose 1.3 per- cent. ●●●●●●●●●●●●●●●●●●● We now serve beer & wine