Dow falls 31 after recovering from early slump

Updated: 2 a.m. ET

Stocks finished lower today as worries built about global growth and the health of the domestic economy. But the major averages ended the day well off sharp lows from early in the day.

The Dow Jones industrials ($INDU) lost as many as 112 points before rebounding to a gain of as many as 26 points. But a late fade pushed the blue-chip index to its sixth straight loss, down 31 points to 12,573.

One catalyst for the slump: Berkshire Hathaway (BRK.B) CEO Warren Buffett conceded the economy is struggling. A second catalyst: investor disappointment that minutes from the Federal Reserve's June meeting gave no hint when it might launch a new round of economic stimulus. But a catalyst for the rebound: Activist investor Bill Ackman has begun building a stake in consumer-products giant Procter & Gamble (PG). P&G was up $2.30 to $63.70.

The finish sets up an important day on Friday. China reported early Friday that its economy grew at an annualized 7.6% in the second quarter. The growth was down from 8.1% a year ago and the lowest growth rate since the first quarter of 2009. Still, the report was in line with estimates. Meanwhile, JPMorgan Chase (JPM) and Wells Fargo (WFC) will report second-quarter results before the open. JPMorgan's results will be closely scrutinized for details about its huge derivatives loss, expected to run about $5 billion. Futures trading suggests a modestly higher open.

In addition to the Dow's loss, the Standard & Poor's 500 Index ($INX) dropped 7 points to 1,335, and the Nasdaq Composite Index ($COMPX) slid 22 points to 2,866. The Nasdaq-100 Index ($NDX) fell 26 points to 2,545.

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Apple (AAPL), the largest influence on the index, finished down $5.53 to $598.90. It had dropped to as low as $592.68. It was Apple's first close below $600 since July 3.

Like the Dow, the S&P 500 suffered its sixth loss in a row. The Nasdaq's decline was its fifth straight. The losing streaks are the worst for the indexes since mid-May. The Nasdaq-100 loss was its fifth straight and its longest losing skein since falling for nine straight days in mid-May.

The market shrugged off a big drop in jobless claims to a seasonally adjusted 350,000, the fewest in four years. A big reason the report didn't generate excitement: Automakers have not been shutting plants down for retooling because they're scrambling to meet current demand.

P&G was the Dow's second-best performer after Merck (MRK), which jumped $1.70 to $42.91 after the drugmaker ended the late-stage study of an osteoporosis treatment because there was clear evidence of success.

The euro's tumble starts a sell-off
Stocks took their cue from the euro, which briefly hit $1.2168 against the dollar, a two-year low, before rebounding to $1.2206. A rising dollar hurts prices of commodities normally priced in dollars and hurts U.S. companies that generate large portions of their revenue from abroad.

The euro's decline -- and the dollar's gain -- was due in large part to French automaker Peugeot's (PEUGY) announcement it was laying off 8,000 workers and shutting down one of its oldest plants next year.  The company already was cutting 6,000 jobs. Peugeot was off 8 cents to $8.62 in New York.

The announcement surprised the French government and stunned European financial markets. France's CAC-40 Index ($FR:PX1) index fell 22 points to 3,135. Germany's Xetra Dax Index ($DE:DAX) fell 35 points to 6,419, and the United Kingdom's FTSE-100 Index ($GB:UKX) fell 56 points to 5,608.

Crude oil (-CL) in New York settled up 27 cents to $86.08 a barrel. It had been as low as $84.21. Brent crude was up 50 cents to $100.73 a barrel. Gold (-GC) settled down $10.40 to $1,565.30 an ounce.

The 10-year Treasury yield fell to 1.479% from 1.498% on Wednesday.

Energy prices -- New York close
			Thur.			Wed.			Month chg.			YTD chg.
Crude oil (-CL)			$86.08			$85.81			1.32%			-12.90%
(per barrel)
Heating oil (-HO)			$2.7733			$2.7618			2.34%			-4.83%
(per gallon)
Natural gas (-NG)			$2.8740			$2.8530			1.77%			-3.85%
(per mil. BTU)
Unleaded gasoline (-RB)			$2.8062			$2.7689			6.63%			5.60%
(per gallon)
Brent crude			$100.73			$100.23			3.00%			-6.19%
(per barrel)
Retail gasoline			$3.3840			$3.3830			0.92%			3.30%
(per gallon; AAA)

Marriott and Supervalu weigh on the markets
Meanwhile, shares of Marriott International (MAR) and supermarket operator Supervalu (SVU) were off sharply. Marriott, which warned of slowing growth in the Middle East and Asia,  was off $2.45 to $35.58.

Supervalu suspended its dividend and said it was conducting a review of its strategic options after earnings fell 45% from a year ago amid intense competition for grocery dollars.

Supervalu, operator of the Albertsons, Jewel-Osco and Shaw’s chains, saw its share price cut nearly in half, down $2.60 to $2.69. Supervalu also pushed down shares of Kroger (KR) and Safeway (SWY). Wal-Mart Stores (WMT), whose expansion into groceries is a big reason for the problems with supermarkets, finished up 5 cents to $72.31.

Boeing (BA) shares closed up 19 cents to $71.71. It announced a $14.7 billion order for more than 150 737 airliners from United Continental Holdings (UAL), which was off $1.01 to $23.78.

Twelve of the Dow stocks were higher, led by Merck and Procter & Gamble. Intel (INTC) and Microsoft (MSFT), the publisher of MSN Money, were the laggards, down 65 cents to $24.74 and 67 cents to $28.63, respectively.

Meanwhile, 139 S&P 500 stocks were higehr, led by Fastenal (FAST), up $2.50 to $42.31, and Merck. Fastenal, which makes fasteners, tools, safety equipment and related products, said earnings grew 18.8% to 38 cents a share. Revenue was up 14.7% to $804.9 million. Sales growth, however, tailed off in the quarter

Safeway, Lexmark International (LXK) and Marriott International were the laggards.

Fastenal was also the top Nasdaq-100 performer, followed by Netflix (NFLX) and O'Reilly Automotive (ORLY). Outsourcing contractor Infosys (INFY) and Sears Holdings (SHLD) were the laggards.

Wells Fargo settles discrimination case for $175 million
Wells Fargo shares were off 42 cents to $32.85. The nation's largest mortgage lender will pay at least $175 million to settle allegations that the company discriminated against black and Hispanic borrowers.

The settlement announced by the Justice Department today involves at least 34,000 minority borrowers who were charged higher fees or were steered by mortgage brokers into risky subprime mortgages when they could have qualified for a prime mortgage, ones offered to borrowers with the best credit.

Wells Fargo denied it had done anything illegal but settled to avoid litigation. It will stop working with mortgage brokers, however. Mortgages sold by brokers currently represent 5% of the Wells Fargo's home loan volume, according to the company. The company stopped all subprime home lending in 2008.

The Justice Department action was triggered by a 2009 examination by the Office of the Comptroller of the Currency, The Wall Street Journal noted. The investigation found that, after controlling for credit factors, that it appeared that minority borrowers in the Washington, D.C., metro area were more likely than white borrowers to be placed in subprime loans, according to the consent order.

Short hits from the markets -- New York close
			Thur.			Wed.			Month chg.			YTD chg.
Treasury yields
13-week Treasury bill			0.1000%			0.090%			25.00%			900.00%
5-year Treasury note			0.627%			0.628%			-13.99%			-24.46%
10-year Treasury note			1.479%			1.498%			-10.85%			-20.95%
30-year Treasury bond			2.564%			2.589%			-7.20%			-11.25%
Currencies
U.S. Dollar Index			83.809			83.728			2.51%			4.08%
British pound			1.5442			1.5511			-1.67%			-0.62%
(in U.S. $)
U.S. $ in pounds			£0.648			£0.645			1.70%			0.62%
Euro in dollars			$1.22			$1.22			-3.27%			-5.76%
(in U.S. $)
U.S. $ in euros			€ 0.819			€ 0.817			3.38%			6.12%
U.S. $ in yen			79.43			79.72			-0.40%			3.02%
U.S. $ in Chinese			6.40			6.37			0.36%			1.10%
yuan
Canada dollar			$0.983			$0.982			0.04%			0.18%
(in U.S. $)
U.S. dollar			$1.018			$1.019			-0.03%			-0.18%
(in Canadian $)
Commodities
Gold (-GC)			$1,565.30			$1,575.70			-2.42%			-0.10%
(per troy ounce)
Copper (-HG)			$3.415			$3.448			-2.33%			-0.61%
(per pound)
Silver (-SI)			$27.1610			$27.0230			-1.63%			-2.70%
(per troy ounce)
Wheat (-ZW)			$8.4675			$8.2625			11.82%			29.72%
(per bushel)
Corn (-ZC)			$7.3225			$7.040			15.36%			13.26%
(per bushel)
Cotton			$0.6993			0.7102			-1.96%			-23.72%
(per pound)
Coffee			$1.8205			1.847			6.65%			-20.73%
(per pound)
Crude oil (-CL)			$86.08			$85.81			1.32%			-12.90%
(per barrel)