While there was better news on the employment front, where the US private sector added more jobs than anticipated in January, all eyes were on the Federal Reserve, which is expected to continue slashing interest rates aggressively this afternoon.
Meanwhile, UBS became the latest financial firm to report huge damage from exposure to the subprime mortgage market after the Swiss bank took a $14bn fourth quarter writedown, $4bn more than previously advised.
Less than an hour after the opening bell, the S&P 500 was down 0.7 per cent at 1,353.44, the Nasdaq Composite fell 0.6 per cent to 2,344.99 while the Dow Jones Industrial Average slipped 0.5 per cent to 12,415.76.
The economy’s rate of growth slowed sharply during the final three months of 2007. Fourth quarter gross domestic product rose 0.6 per cent, down from a 4.9 per cent rate in the third quarter. Economists had expected a 1.2 per cent growth rate during the fourth quarter.