By Polya Lesova, MarketWatch
FRANKFURT (MarketWatch) -- U.S. stock futures extended their losses Thursday after data showed a rise in weekly jobless claims and a disappointing revenue outlook from Cisco Systems Inc. weighed on the technology sector.
Futures on the Dow Jones Industrial Average dropped 79 points to 10,258, and S&P 500 futures fell 10.70 points to 1,074.30. Nasdaq 100 futures slid 21.25 points to 1,816.50.
The number of initial claims for regular state unemployment insurance benefits rose 2,000 to 484,000 in the week ended Aug.7, reaching the highest level since February, the Labor Department reported. Economists polled by MarketWatch had expected a level of 463,000.
"Once again, we can say with near-total certainty that there is no meaningful improvement on the labor front," said Dan Greenhaus, chief economic strategist at Miller Tabak & Co., in an emailed note.
The four-week average of initial claims also increased to the highest level since February.
On Wednesday, the Dow /quotes/comstock/10w!i:dji/delayed (DJIA 10,334, -44.35, -0.43%) tumbled 265.42 points, or 2.5%, posting its biggest one-day point drop since June 29. So far this year, the Dow has fallen 0.5%.TODAY'S TOP MARKET STORIES
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"We see these big companies starting to issue lower guidance for the rest of the year, and then we have all this bad macro news out of the U.S., with every report coming out worse than expected or worse than the previous month," said Mads Koefoed, market strategist at Saxo Bank.
"What is needed is a string of solid macro performance from the U.S." in order to boost investor sentiment, he said.
The aftermath of the Federal Reserve's meeting earlier this week has continued to put pressure on equities, Koefoed said.
Also, "Cisco reported fairly strong earnings, but they presented a lower sales forecast for the rest of 2010," Koefoed said. "Now that we've seen these earnings grow by very high rates due to cost-cutting, companies need to get their top line to grow. And when they can't do that, it will weigh on equities."
Late Wednesday, Cisco /quotes/comstock/15*!csco/quotes/nls/csco (CSCO 21.46, -2.27, -9.57%) reported quarterly revenue that was slightly below market expectations, and its outlook also disappointed investors. Shares of Cisco dropped 7.5% in premarket trading. Also in the sector, shares of ASML Holding /quotes/comstock/15*!asml/quotes/nls/asml (ASML 28.48, -0.36, -1.25%) fell 2.6%.
Shares of Anheuser-Busch InBev /quotes/comstock/13*!bud/quotes/nls/bud (BUD 53.07, +2.22, +4.37%) /quotes/comstock/24s!e:abi (BE:ABI 41.20, +2.10, +5.37%) jumped 3.5% in premarket trading after the brewer reported a rise in second-quarter net profit and stronger-than-expected volumes.
European equities dropped after the jobless-claims data, with the Stoxx Europe 600 index /quotes/comstock/22c!sxxp (ST:SXXP 255.08, +0.40, +0.16%) down 0.2% in afternoon trading.
Germany's DAX index /quotes/comstock/30p!dax (DX:DAX 6,135, -18.90, -0.31%) fell 0.5%, with shares of chip maker Infineon Technologies /quotes/comstock/11e!fifx (DE:IFX 4.70, -0.11, -2.23%) trading down 3.2%.
Shares of utility giant RWE AG /quotes/comstock/11e!frwe (DE:RWE 53.62, -0.63, -1.16%) declined 1.1%. The firm said its first-half net profit dropped 8% and warned that it will have to review its medium-term goals because of Germany's plan to introduce a nuclear-fuel tax.
The dollar extended its gains against other major currencies, with the dollar index /quotes/comstock/11j!i:dxy0 (DXY 82.44, +0.15, +0.18%) trading up 0.4% to 82.637.
The euro /quotes/comstock/21o!x:seurusd (EURUSD 1.2864, +0.0020, +0.1557%) fell to $1.2813, as data showed that euro-zone industrial production fell 0.1% in June compared to the previous month. Economists had forecast a 0.5% monthly rise.
Most Asian shares ended lower, with the Shanghai Composite index dropping 1.2%.
Crude-oil futures were under selling pressure once again, with the September contract falling $1.12 to $76.90 a barrel in electronic trading on the New York Mercantile Exchange.
Polya Lesova is MarketWatch's London bureau chief.Powered By iWebRSS.com