Stocks down on higher unemployment

Dow dropped 105 to 11082 getting close to the 10962 low close of Jul 15. This is testing time, I think the support will not hold. Decliners are over advancers 4-1 and NAZ is down 28. The S&P 500 FINANCIALS INDEX is down 2 to 279. After the 5 day relief rally following July 15 low, it had risen to 277. Oils are down 2% & the Alerian MLP index dropped 5 to 259. This selling is testing the 2 year low, 258, reached a few weeks ago.

There is plenty of gloomy news about the economy. The Labor Dept reported the jobless rate rose to 6.1% as 84K jobs were lost in Aug (vs forecasts of 75K).

•Payrolls in U.S. Fall More Than Forecast; Jobless Rate at Five-Year High

The foreclosure rate in Q2 rose to 1.19%, highest rate in 29 years. The mortgage mess will continue bringing additional significant mortgage writedowns in Q3 & Q4.

•Mortgage Foreclosures in U.S. Rise at Fastest Pace in Almost Three Decades

Merrill Lynch (MER), down 72¢, the largest brokerage firm, was downgraded to "sell" by Goldman Sachs. They were "battered by more than $40 billion of credit market writedowns" which summarizes thinking for the sell recommendation.

Merrill Lynch Cut to `Sell' at Goldman; Credit-Market Writedowns May Rise


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