Todays share of bad news:

The U.S. Labor Department said that jobless claims were up 3,000 last week to 588,000, more than expected. 

The U.S. Commerce Department said that durable goods orders were down 2.6% in December, weaker than expected. For all of 2008, orders were down 5.7%, the second largest decline on record

The U.S. Census Bureau said that new home sales were at an annual rate of 331,000 units in December, down 14.7% from November's pace and weaker than expected. For all of 2008, there were 482,000 new homes sold, down 38% from 2007. 

The markets showed a notable weakness during the pre market trading as the economic data didnt show any signs of improvement in the economy. After trending higher in the last 4 sessions, stocks moved back to the downside during the day, as traders did some profit taking. 

Housing stocks saw substantial weakness, as traders reacted to the disappointing new home sales data. Financials were hurt by the profit taking  from yesterdays rally. Significant weakness also emerged in the airline sector, as reflected by the 5.2 percent loss posted by the Amex Airline Index. U.S. Airways (LCC) and Continental (CAL) fell sharply after reporting significantly wider fourth quarter losses compared to a year ago.

GOld, as I mentioned in my previous posts has edged above $900 dollars again. 

Another batch of key economic data is due to be released on Friday, including the Commerce Department's advance report on fourth quarter gross domestic product. The report is expected to show that GDP fell by 5.4 percent in the last three months of 2008.