By Ellis Mnyandu
NEW YORK (Reuters) - Stocks fell on Thursday as Wal-Mart's disappointing December sales and dim profit outlook fueled concerns the recession may be deepening.
Trade was choppy, however, as investors bet that President-elect Barack Obama will push for a massive economic stimulus plan, though some unease remained as details of his plan remained sketchy.
Shares of Wal-Mart Stores Inc
"I think we're torn between optimism between the new administration and stimulus plans and the awful economic outlook," said Frank Lesh, a futures analyst and broker at FuturePath Trading LLC in Chicago. "Expectations are almost for the worst at this point in time. Maybe we come out not as bad."
Obama, speaking on the economy ahead of his swearing-in on January 20, said his plan includes a $1,000 tax cut for middle-class families and extended jobless aid and health-care coverage for the unemployed.
He asked Congress to work "day and night" to swiftly pass a plan for tax cuts and public works spending that could total nearly $800 billion. But skyrocketing deficits may make the proposal a tough sell with some lawmakers.
The Dow Jones industrial average <.DJI> shed 87.45 points, or 1.00 percent, to 8,682.25. The Standard & Poor's 500 Index <.SPX> dipped 5.02 points, or 0.55 percent, to 901.63. The Nasdaq Composite Index <.IXIC> declined 0.93 points, or 0.06 percent, to 1,598.13.
Investors snapped up some of Wednesday's worst losers, including aluminum producer Alcoa
Wal-Mart offered the starkest indication yet that consumer spending, which accounts for about two-thirds of economic activity, continues to falter as households fret about mounting unemployment and dwindling savings.
(Additional reporting by Chuck Mikolajczak; Editing by Leslie Adler)
