Wall Street slide on grim jobs data

[nithyasubramanian]

A handful of bleak profit forecasts and more evidence of escalating unemployment unnerved investors on Wednesday, sending stocks down sharply. All the major indexes lost more than 1.5 per cent, including the Dow Jones industrials, which tumbled about 175 points.

Underscoring investors' fears that 2009 is shaping up to be a difficult year for many sectors, Time Warner and Intel issued disappointing numbers.

Time Warner Inc said it expects to record a fourth-quarter $25 billion impairment charge for its cable, publishing and AOL units that will lead to an operating loss for the period and a loss for the full year. It had expected a profit between $1.04 and $1.07 per share for the year.

Meanwhile, computer chip maker Intel Corp said it expects fourth-quarter revenue to drop 23 per cent, below prior estimates, due to weak demand and inventory reductions by its computer maker customers.

Time Warner shares shed 63 cents, or 5.8 per cent, to $10.35.
Intel fell 60 cents, or 3.9 per cent, to $14.77.
Aluminium producer Alcoa Inc's decision to slash jobs further jolted investors.

Alcoa said late on Wednesday it is reducing its global work force by about 13,500, or 13 per cent, by the end of the year and lowering total output by more than 18 percent annually. Alcoa tumbled $1.05, or 8.7 per cent, to $11.07.

The announcement comes ahead of the Labour Department's report on Friday on the job market, a closely watched barometer of the economy's health.