NEW YORK (AP) — Stocks were mostly lower in midday trading on Wall Street Thursday on signs that Americans are spending at a slower pace and that China's economy is in worse shape than previously thought.
American shoppers pulled back on spending in June, resulting in tepid sales for many retailers. Target fell 1 percent after reporting that its sales rose less than analysts were expecting. Fred's Inc. fell 4 percent.
"It all boils down to one little word: uncertainty," said Peter Cardillo, chief market economist at Rockwell Global Capital. "No one will spend if it feels like we're in a recession."
The reports raise concerns about Americans' ability to spend during the back-to-school shopping season, which starts later this month.
The Dow Jones industrial average was down 32 points at 12,912 shortly after noon.
The Standard & Poor's 500 fell four points to 1,370. The Nasdaq composite inched up two points to 2,978.
Seven of the 10 industrial sectors fell in the S&P 500, led by bank stocks. JPMorgan Chase fell $1.4, or nearly 4 percent, to $34.54, while Bank of America fell 19 cents, or 2.4 percent, to $7.87.
China surprised investors earlier Thursday with its second rate cut in a month, leading investors to worry that the downturn in the world's second-largest economy may be worse than previously expected.
The People's Bank of China cut its main lending rate 0.31 percentage point to 6 percent and reduced its deposit rates by a quarter of a percentage point to 3 percent. The bank said the lower rates are intended to boost economic growth in the second half of the year. Analysts said the cuts are also a sign that Chinese authorities are increasingly concerned about that country's economy.
Central banks in Europe were also moving to stem a slowdown there. The Bank of England approved a 50 billion pound injection into the ailing British economy, while the European Central Bank cut its main interest rate by a quarter of a percentage point to 0.75 percent, the lowest it's been since the bank was established in 1999.
In the U.S., though some key retailers reported poor sales for June, several others beat analysts' expectations.
Ross Stores rose $3.32, or over 5 percent, to $66.11 after the discount store operator said sales at stores open at least a year rose 7 percent in June, easily beating Wall Street predictions. TJX Cos., which operates T.J. Maxx, Marshalls and Home Goods stores, also reported a wider-than-expected 7 percent increase in sales last month. Its stock rose $1.48, or 3.5 percent, to $43.97.
Investors were bracing for the closely-watched government's report on hiring for June that is scheduled for release on Friday. Economists are predicting the unemployment rate to stay at 8.2 percent.
However, at least two reports on Thursday sketched a picture of a slowly improving job market.
Weekly unemployment benefit applications dropped by 14,000 to 374,000, the Labor Department said Thursday. That's the fewest since the week of May 19.
Separately, payroll provider ADP said businesses added 176,000 jobs last month. That's better than the revised total of 136,000 jobs it reported for May and, if sustained, would be enough to lower the unemployment rate.
Among other stocks making big moves:
— Netflix rose $8.28, or 11.6 percent, to $80.40 after the company said earlier this week that its online subscriber base was increasing.
— Apple gained $12.63, or over 2 percent, to $612.10, after The Wall Street Journal reported that the company is preparing to come out with a new tablet computer with a screen smaller than the one its hugely popular iPad.
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