“Everyone wants to have this optimism that Obama’s going to be able to solve things, but he doesn’t have a lot of bullets in the gun,” said David Klaskin, chief investment officer at Oak Ridge Investments.  New government data and profit reports underscored investor fears.  Microsoft surprised investors by reporting before the markets opened that it would cut 5,000 jobs as sales slowed. The Labor Department said that first-time unemployment claims had risen to 589,000 last week, tying a record high set in December.  And the Commerce Department reported that new-home construction had slumped to an annual rate of 550,000 in December, its slowest pace on record. The data offered one more sign that home builders had cut back drastically on developments as housing prices plunge.  Technology companies were among the hardest-hit on Thursday, weighed down by an 11.7 percent slide in shares of Microsoft, which closed at $17.11 a share. I.B.M., which helped vault stocks higher on Wednesday with a positive earnings report, retreated. Dell, Sun Microsystems and Yahoo were all lower.  Shares of Apple, however, rose 6.7 percent, to $88.36, after a positive earnings announcement released after the markets closed on Wednesday.  Financial stocks were down again on Thursday, as investors took home profits from a sharp rally in the sector on Wednesday. Citigroup, Bank of America and Wells Fargo were lower.  Crude oil prices settled at $43.67 a barrel on Thursday, down 12 cents.  Long-term Treasury yields rose to their highest levels in a month as investors began to question whether there would be enough demand to absorb the billions in government debt likely to come to market in 2009.  The Treasury’s 10-year note fell 18/32, to 109 30/32. The yield, which moves in the opposite direction from the price, rose to 2.59 percent, from 2.53 percent late Wednesday.  “We’re looking at record supply in a market that’s going to be seeing a huge fiscal stimulus package,” said Derrick Wulf, portfolio manager at Dwight Asset Management. “There’s been a lot of indigestion this week.”  A version of this article appears in print on , on Page B6 of the New York edition with the headline: Shares Slide as Grim News Keeps the Markets on Edge. Order Reprints| Today's Paper|Subscribe
Stock markets clipped their losses in afternoon trading but were still trading in the red as investors grappled with disappointing news from Microsoft and the housing market.