Ellington

U.S. stocks continued a two-day slide Thursday on weak economic data and concern about the Federal Reserve's resolve to keep juicing the market.

European stocks were sharply lower a day after U.S. stocks sustained some of their steepest declines this year. A monthly survey of European executives showed that business activity in the European Union slowed in February, a strong signal that a downturn that began last year will continue into 2013.

Stock indexes in France, England and Germany fell more than 1.5 percent.

Signaling that the U.S. labor market remains in slow recovery mode, the government said more people applied for unemployment benefits last week. The four-week average, a less volatile measure, rose to the highest in six weeks.

The Dow Jones industrial average fell 70 points to 13,859 in the first 30 minutes of trading. The Standard & Poor's 500 index dropped 11 to 1,500. The Nasdaq composite index lost 27 to 3,137.

Wal-Mart Stores rose after beating analysts' profit expectations in the fourth quarter. However, the biggest retailer warned of a slow start to the year. It gained $1.11 cents, or 1 percent, to 70.32.

The company said that after a strong start to the holiday season, the first three weeks of December were weak, and business has been volatile since then. Wal-Mart attributed some of what it is seeing to a delay in tax refund checks that have left people strapped for cash.

Supermarket chain Safeway was the biggest gainer in the S&P 500, rising $1.16, or 6 percent, to $21.29. Its jumped 13 percent in the fourth quarter, helped by higher gift and prepaid card revenue.

Electric car company Tesla Motors plunged after a day after reporting that its fourth-quarter net loss grew 10 percent on costs related to production of its new Model S. The stock fell $3.74, or 10 percent to $34.80

Asian stocks closed sharply lower. The sell-off began Wednesday afternoon in New York after the release of minutes from the Fed's latest meeting suggesting that some policymakers want to wind down bond purchases and other measures aimed at boosting the economy.

The minutes showed new divisions over the Fed's low-interest rate policies. There is no sign of inflation, yet there was more evidence that some Fred officials are ready to ease off the stimulus programs before the economy has fully recovered.

The yield on the 10-year Treasury note fell to 1.98 percent from 2.05 percent early Wednesday as demand increased for ultra-safe assets.