Stocks Dropped at Open after Grim GDP and Jobless Claims Reports

U.S. stocks dropped at open on Thursday, after economic reports showed the steepest decline in GDP in the second quarter and a second straight increase in weekly jobless claims. The Dow Jones Industrial Average lately dropped 353.10 points, or 1.33%, to 26,186.47. The S&P 500 lost 33.02 points, 1.01%, to 3,225.42. The Nasdaq Composite declined 68.34 points, or 0.65%, to 10,474.60.

Oil futures lost ground Thursday, pressured by worries a resurgence in coronavirus cases around the world will cause demand to falter as major oil producers begin relaxing output curbs. West Texas Intermediate crude for September delivery dropped 74 cents, or 1.8%, to $40.53 a barrel, while October Brent crude was off 69 cents, or 1.5%, at $43.40 a barrel.

The US economy contracted at the sharpest rate on record in the second quarter this year. GDP fell at a 32.9% annualized pace, the Commerce Department said, crushed by coronavirus lockdowns. Consumer spending, the main engine of the economy, contracted by a record 34.6% annualized clip in the spring.

The number of Americans applying for jobless benefits rose for the second straight week. Initial jobless claims rose by 12,000 to 1.434 million in the week ended July 25, the Labor Department said Thursday.

United Parcel Service (UPS) delivered second-quarter results that topped consensus expectations. Second-quarter adjusted earnings of $2.13 per share were nearly twice the $1.07 expected. Revenue of $20.5 billion climbed 13% over last year, and was better than the $17.47 billion expected.

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