U.S. markets plummeted Thursday with 28 of 30 Dow components sinking in a broad sell-off.
The Labor Department said 1,000 fewer jobless claims were filed in the week ending last Saturday, but investors are looking at several months of disappointing data in manufacturing, housing, unemployment and consumer spending.
The Labor Department's weekly report came a day before the monthly employment situation report. Economists expect the unemployment rate will be unchanged, holding at 9.2 percent in July.
On Wall Street in early afternoon trading, the Dow Jones industrial average lost 303.34 points, 2.55 percent, to 11,593.10. The Standard & Poor's 500 index lost 34.43 points, 2.73 percent, to 1,225.47. The Nasdaq composite index shed 76.23 points, 2.83 percent, to 2,616.84.
Bucking the trend, shares of Kraft Foods Inc., which said it would split into two companies -- a global snack company and one handling North American groceries -- rose 0.8 percent. Shares of McDonald's Corp. rose 0.3 percent.
The benchmark 10-year treasury note rose 30/32 to yield 2.521 percent.
The euro fell to $1.4156 from Wednesday's $1.4323. Against the yen, the dollar rose to 78.83 yen from Wednesday's 77.06 yen.
In Tokyo, the Nikkei 225 index rose 0.23 percent, 22.04, to 9,659.18.
In London, the FTSE 100 index lost 3.2 percent, 178.75, to 5,405.76.