NEW YORK -- The Dow Jones industrial average has fallen more than 200 points as investors react to a weak outlook from retail giant Wal-Mart and a spike in the yield on the 10-year Treasury note to a fresh two-year high.
JOBLESS CLAIMS: Fall to six-year low
WAL-MART: Slashes outlook
INFLATION: Consumer prices up 0.2%
MANUFACTURING: Output slips 0.1%
COLUMN: Summers or Yellen? Callaway's take
CISCO: Cuts 4,000 jobs
A day after the Dow Jones industrial average tumbled 113 points, its first triple-digit loss since June 28, the Dow was off another 1.5%, or about 224 points, as of about 1:30 p.m. ET. It was hurt by weakness in two key components: Wal-Mart and networker Cisco Systems.
The Dow is on track for its first back-to-back triple-digit drop since June 19-20, when it tumbled nearly 560 points. That swoon was sparked by the Federal Reserve, which said after its June meeting that it would start dialing down its market-friendly bond-buying program later this year if the economy and jobs market continue to improve.
The Standard & Poor's 500 index was 1.4% lower and the Nasdaq had declined 1.6%.
Before the opening bell, Wal-Mart reported earnings below expectations, and reported same-store sales slipped 0.3%, below the 1% gain analysts expected. The retailer also lowered its earnings and sales projections for the rest of 2013. Wal-Mart shares were down 2.4% in early trading.
Cisco topped earnings after last night's close but said it would slash 4,000 jobs and cut its outlook for the current quarter. Cisco shares were down as much as 7% in early trading.
The yield on the 10-year spiked as high as 2.82% in early trading, its highest level since July 28, 2011, before pulling back to 2.80%.
Investors are also spooked by the possibility of the Federal Reserve starting to reduce its market-friendly bond-buying program as early as September.
Wall Street is wondering if the rise in rates is already taking a bite out of the economy, and point to weak retail sales as a sign.
Investors were also reacting to a weak reading on manufacturing in the New York region. The Empire State manufacturing index fell to 8.2% in August, down from 9.5 in July and below what Wall Street was expecting.
That bad news offset good news on the jobs front. The government reported that the number of Americans filing first-time jobless claims fell 15,000 last week to 320,000, much better than the 335,000 economists' expected.
Japan's Nikkei 225 index fell 2.1% to 13,752.94, reacting in part to a pullback by U.S. markets in the previous session.
On Wednesday, the Dow declined 0.7% to 15,337.66. The S&P 500 index dropped 0.5% to 1,685.39. The Nasdaq fell 0.4% to 3,669.27. A poor earnings report from major retailer Macy's cast doubt on the outlook for consumer spending, a vital component of the U.S. economy.
WEDNESDAY: Stocks end lower amid spending doubts
Benchmark oil for September delivery was up 46 cents to $107.31 per barrel in electronic trading on the New York Mercantile Exchange Thursday. The contract rose 2 cents to close at $106.85 a barrel on the Nymex on Wednesday. U.S. crude supplies fell in a possible sign of stronger demand.
Contributing: Associated Press