by David Haggith, The Great Recession Blog:
The Dow plunged 686 points midday on Thursday and closed down 458, wiping out a large relief rally from the day before, and it went down for the key reason I laid out for understanding why the Fed will over-tighten and drive the economy into an extremely deep recession.
A batch of economic data that reinforced expectations the Federal Reserve will continue with its aggressive pace of rate hikes set the tone, analysts said, while a sharp selloff across tech-related shares amplified the damage.
The latest update to second-quarter GDP figures confirmed that the U.S. economy shrank at an annualized clip of 0.6% in the second quarter. However, a weekly report on U.S. jobless benefit claims revealed that the number of Americans initially applying for unemployment benefits fell by 16,000 to 193,000 in the week ended Sept. 24, the lowest level since April.