NEW YORK — US stocks sank on Thursday, as more signs of weakness in the labor market and increasingly sluggish growth overseas heightened concerns about the corporate profit outlook.
The market hobbled out of the opening gate after weekly government data showed an unexpected jump in the number of filings for jobless benefits, while a report by ADP Employer Services showed private employers cut 33,000 jobs in August.
The data fueled investor nervousness ahead of the government's key August non-farm payrolls report, and losses cascaded in afternoon trading. Only two of the Dow's 30 components escaped the sell-off.
Construction and mining equipment maker Terex Corp. compounded the gloom when it cut its 2008 sales and profit forecast, citing weak demand in Western Europe and North America. Its shares tumbled 21 percent to $37.36.
Other top drags included economic bellwethers Caterpillar Inc. and General Electric.
"It's definitely fear of an economic downturn that's hurting us today," said Jack Ablin, chief investment officer at Harris Private Bank in Chicago. "The economic data and the downbeat forecasts from management don't lend a lot of confidence to the economic revival outlook."
The Dow Jones industrial average fell 333.25 points, or 2.89 percent, to 11,199.63, while the Standard & Poor's 500 Index dropped 36.72 points, or 2.88 percent, to 1,238.26. The Nasdaq Composite Index was down 68.15 points, or 2.92 percent, at 2,265.58.
A lower close would mark the fourth day of losses for both the Nasdaq and the S&P 500, and would be the worst four-day performance for both indexes in nearly three months.
Adding to market jitters were comments from Bill Gross, the manager of the world's biggest bond fund. In order to stop a sell-off in an array of financial markets, the US government should give the Treasury the right to buy debt and other assets to halt a financial tsunami, said Gross, the manager of Pacific Investment Management Co.
Generally lackluster August retail sales were another headwind for the market, as were concerns that sluggish growth was emerging abroad. The president of the European Central Bank, Jean-Claude Trichet, said euro zone data points to weakening growth at midyear.
"The job market has been just a slow drip of bad news," said John Augustine, chief investment strategist at Fifth Third Asset Management in Cincinnati. "That's better than an open faucet, but it's still bad news for the economy. The stock market is struggling because it's waiting for better labor market news."
Economists expect the government's labor report on Friday to show a decline of 75,000 jobs in August, which would be the eighth consecutive month of job losses in the United States.
Shares of Caterpillar, the maker of bulldozers and excavators and a major exporter, fell 6.0 percent to $63.67.
Boeing's stock slid 5.5 percent to $62.46 after the plane maker's largest labor union said its members had rejected the company's contract offer and voted to strike.
Shares of investment bank Lehman Brothers fell 10.4 percent to $15.16. Lehman's LibertyView hedge funds lost money in July, when tumbling financial markets left many hedge fund managers nursing their biggest declines of the year, according to a note to investors obtained by Reuters.
Shares of technology companies, considered vulnerable because of their overseas exposure, tumbled. Networking equipment maker Cisco Systems was a top drag on the S&P 500, with a drop of 4.4 percent at $22.29 on Nasdaq.
BlackBerry devices maker Research In Motion was the top Nasdaq drag, falling 5.4 percent to $108.59. Shares of iPhone maker Apple dropped 3.1 percent to $161.76.
