23 Jan 2009

Wall Street falls

11:50 am on 23 January 2009

Stocks in the United States slid on Thursday, after Microsoft announced job cuts and lower earnings. Economic data also showed further deterioration in the labour and housing markets.

Shares in Microsoft Corp fell nearly 12% at one point in the session.

Before the market opened, the Labour Department said the number of new unemployment claims rose to 589,000 in the past week.

The Commerce Department said construction starts on new homes and housing building permits fell by 15.5% in December from the previous month to an annualised rate of 550,000 units.

The Dow Jones industrial average fell 105.30 points, or 1.28%, to 8,122.80.

Standard & Poor's 500 Index dropped 12.74 points, or 1.52%, to 827.50. The Nasdaq Composite Index slumped 41.58 points, or 2.76%, to 1,465.49.

Microsoft traded as low as $US17.07 - its lowest price since January 1998 - and ended trading on Nasdaq down 11.7% at $US17.11.

In contrast to Microsoft, Apple Inc shares rose 6.7% to $US88.36 after reporting higher earnings than expected last quarter.

Trading volume was moderate on the New York Stock Exchange, with about 1.56 billion shares changing hands. About 2.31 billion shares were traded on the Nasdaq - roughly equal to last year's daily average of 2.28 billion.