New York, Oct 2 (IANS) The US stocks pared early gains to trade lower around midday Thursday, as International Monetary Fund (IMF) Managing Director Christine Lagarde warned of a “new mediocre” risk facing global economy.
By noon, the Dow Jones Industrial Average dipped 178.31 points, or 1.09 percent, at 16,106.39. The S&P 500 lost 14.81 points, or 0.77 percent, at 1,905.22. The Nasdaq Composite Index was down 47.98 points, or 1.04 percent, at 4,572.18, Xinhua news agenct reported.
In the curtain-raising speech for the IMF-World Bank annual meetings Wednesday, Lagarde said the global economy is approaching closer to a “new mediocre” scenario — the risk of low growth for a long time.
Lagarde expected that global growth will likely be weaker this year than last year, with only a modest acceleration expected in 2016 given the disappointing and uneven growth of the world economy.
The IMF is expected to downgrade its outlook for the global economy in its flag-ship report World Economic Outlook, which will be released at the annual meetings in Peru next week.
On the US economic front, in the week ending September 26, the advance figure for seasonally-adjusted initial jobless claims increased by 10,000 from the previous week’s unrevised level to 277,000, above market consensus of 272,000, said the US Labour Department on Thursday.
The four-week moving average remained at a very low level of 270,750, a decrease of 1,000 from the previous week’s unrevised average, suggesting continued strength in the labour market.
Meanwhile, the US September manufacturing purchasing managers’ index (PMI) registered 50.2 percent, a decrease of 0.9 percentage points from the August reading of 51.1 percent, said the Institute Supply Management (ISM) Thursday.
The US stocks posted solid gains Wednesday as Wall Street cheered over a strong rebound in overseas stock markets.