U.S. stock futures dropped Thursday as retailing giant Wal-Mart Stores scaled back earnings expectations, citing a worse-than-expected December performance. S&P 500 futures fell 10 points to 895.20 and Nasdaq 100 futures fell 10 points to 895.20 and Nasdaq 100 futures dropped 122 points. Much of the sales reports coming from the retail sector were glum. Shares of the world's top retailer, Wal-Mart Stores , tumbled 8% after the group cut its fourth-quarter earnings estimates. December same-store sales at the retailing giant, excluding fuel, rose 1.7%. See retail wrap. But shares of Sears Holdings rallied over 8% in pre-market trade as the group said fourth-quarter earnings would top analyst estimates. Urban Outfitters shares also rose after a sales update. Thursday also saw the release of jobless data, as first-time applications for state unemployment benefits fell 24,000 to a seasonally adjusted 467,000 in the week ending Jan. 3, the Labor Department said Thursday. The drop in this week's data, as well in the prior week, may be due to some layoffs occurring earlier than government analysts had expected, according to the Labor Department, which added that claims could remain low for a couple of more weeks and then tick up. Economists didn't read much into the decline in claims. "Given the volatility of initial claims around the turn of the year--in part because of the difficulties of seasonally adjusting for holiday-shortened weeks--one cannot read much at this point into the decline in claims (which still signal weakness even if taken at face value)," said economists at RDQ Economics. The government's key monthly report is due out Friday. Treasurys advanced Thursday, pushing yields lower, after the jobless data. Job cut announcements also came from the tech sector: EMC , the data-storage firm, announced 2,400 job cuts. Dell is closing computer manufacturing activities in Ireland that employ 1,900 and moving production to Poland. EMC rose 4.7% in pre-market trade as analysts also highlighted in-line sales. Dell slipped 1.4%. The dollar dropped 1.6% against the Japanese yen, and the dollar falling vs. the yen is frequently an indicator of declining risk appetite. The British pound rose against both the euro and the dollar as the Bank of England cut interest rates to their lowest level since the central bank's founding in 1694, with rates falling a half point to 1.5%. Oil futures, after a 12% tumble on Wednesday, extended their decline, falling over $1 a barrel. Three-month dollar LIBOR continued to slide, falling to 1.35% from 1.4%. In Asia, technology, energy and financial shares led regional markets lower, with the Hang Seng losing 3.8% and the Nikkei 225 slumping 3.9%. In Europe, the U.K. FTSE 100 lost 1.7% and the German DAX 30 fell 1.7% in early afternoon trade, with big losses seen for the metals sector. U.S. stocks dropped on Wednesday after job-cut and profit warnings from heavyweights like Alcoa, Intel and Time Warner combined with a report from payrolls processor ADP estimating that nearly 700,000 private-sector jobs were lost last month. The Dow Jones Industrial Average dropped 245 points, the Nasdaq Composite lost 53 points and the S&P 500 dropped 28 points.

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