U.S. stocks declined for a second day after Cisco Systems Inc. forecast a drop in sales and initial jobless claims unexpectedly jumped to a 26-year high. Cisco, the world’s largest maker of networking equipment, fell 2.1 percent after saying customers slashed spending in January. State Street Corp., the world’s largest money manager for institutions, lost 1.5 percent after slashing its dividend. Dell Inc. sank 4.7 percent as JPMorgan Chase & Co. recommended selling the shares. Eight of 10 industry groups in the Standard & Poor’s 500 Index fell after the Labor Department said 626,000 people filed new claims for unemployment benefits last week. The Standard & Poor’s 500 Index retreated 0.9 percent to 824.81 as of 9:39 a.m. in New York. The Dow Jones Industrial Average slipped 0.6 percent to 7,909.98. The Nasdaq Composite Index fell 1 percent to 1,500.5. “The market is falling on earnings reports,” Jean- Christophe Liard, an analyst at KBL Richelieu Gestion, which oversees $5.1 billion, said in a Bloomberg Television interview from Paris. “Certain ones aren’t at all reassuring.” U.S. stocks slid yesterday as Kraft Foods Inc. and Walt Disney Co. reported profits that missed analysts’ estimates, triggering a sell-off in consumer shares. The S&P 500 has dropped 8.7 percent this year after earnings at companies from Microsoft Corp. to Procter & Gamble Co. disappointed investors and the economy shrank at the fastest pace in 26 years. The U.S. benchmark is still 10 percent above an 11-year low on Nov. 20 amid optimism economic stimulus legislation developing in Congress will spur growth. The number of Americans filing first-time claims for unemployment insurance benefits increased by 35,000 to 626,000 in the week ended Jan. 31, the highest total since October 1982, the Labor Department said today. Labor Department data to be released tomorrow is forecast to show economy-wide job losses of 540,000, adding to almost 2.6 million lost last year.

Source