The U.S. economy lost another 62,000 jobs in June, the U.S. Labor Department announced Thursday, as surging fuel prices forced companies in the world's largest economy to continue to cut expenses to protect profits in the face of the economic slowdown.

Meanwhile, the unemployment remained at 5.5% in June, the highest level since October 2004.

Economists surveyed by Bloomberg News had expected the U.S. economy to shed 50,000 jobs in June. Furthermore, June was the U.S. economy's sixth straight monthly job loss. The U.S. economy lost a revised 62,000 jobs in May, up from the 49,000 earlier estimate; the U.S. economy lost 28,000 jobs in April.

The June job losses brought total job losses in 2008 to 438,000, the Labor Department said.

Meanwhile, the number of unemployed persons was unchanged at 8.5 million in June. Since March 2007, the number of unemployed persons has increased by 1.2 million, and the unemployment rate has risen by 1.5% point.

Let's just say that if the Dow Jones Industrial Average on Thursday closes down 200 points, we'll call it a moral victory. The Dow Wednesday closed down 166.75 points to 11,215.75.

"What was that famous Bette Davis line about a bumpy night? Well, Thursday could be a bumpy day," economist Peter Dawson told BloggingStocks Wednesday.

Thursday could be very bumpy for the stock market because a series of data points -- all expected to be negative -- are converging at a traditionally difficult time of the year for the market - the start of summer.

Three data points of significance

First up is the European Central Bank's interest rate decision at 7:45 a.m. EDT, at which the bank is expected to increase its key, short-term interest rate, the refinance rate, by a quarter-point to 4.25%. The ECB is trying to check inflation, Dawson said, but it may end up hurting the dollar. If the markets believe the already-weak dollar will fall further, that will increase commodity prices, including oil, "which will not be good news for stocks," he said.

Factory orders increased 0.6% in May, the U.S. Commerce Department announced Wednesday, on rising demand for computers and defense equipment. It was the third consecutive monthly rise in factory orders, the Commerce Department said. Excluding the often-volatile transportation component, factory orders increased 0.4%.

Economists surveyed by Bloomberg News had expected May factory orders to increase by 0.6%. Factory orders increased a revised 1.3% in April.

Economists follow the factory orders statistic because it provides one of the most comprehensive surveys of advance orders for durable goods -- how busy factories are likely to be in the period ahead. Factory orders also are a major value-added component of the U.S. economy.

In May, new orders rose 1.2%, bookings increased 0.6%, shipments rose 0.1%, and unfilled orders increased 0.1%. Also, the inventories-to-shipments ratio was virtually unchanged in May at 1.23, compared to 1.22 in April.

Non-farm private employment decreased 79,000 in June on a seasonally adjusted basis, ADP announced Wednesday in the ADP National Employment Report. (pdf)

Meanwhile, the May estimated change in employment was revised down 15,000 to a gain of 25,000 jobs, ADP said.

In the June jobs report, employment in the service-providing sector fell 3,000, its first declined since November 2002. The goods-producing sector declined 76,000, and manufacturing employment fell 44,000, their 19th and 22nd consecutive monthly declines, respectively.

Employment among small-size businesses, defined as those with fewer than 50 workers, rose just 7,000 during the month, while employment at large businesses with more than 500 workers declined 51,000. Jobs at medium sized business, with 50-499 employees, decreased 35,000.

In a surprise, the U.S. manufacturing sector increased production and expanded in June.

The Institute for Supply Management Manufacturing Index rose to 50.2 in June from 49.6 in May, the Institute announced Tuesday. It was the first increase for the index since January. Readings above 50 indicate economic growth; readings below 50, economic contraction.

Economists surveyed by Bloomberg News had expected the index to drop to 48.7 in June 2008.

Economist David H. Wang Tuesday cautioned against taking a too positive interpretation of the June ISM manufacturing data. "We have to keep in mind that this is just one month and the trend had indicated contraction for five months," Wang said. "Also, we are barely above 50, and the index could easily drop below 50 in the next month, which would be consistent with a continuing contraction, so evaluate the June results in that context."

If you believe the Dow Jones Industrial Average is a leading indicator of economic conditions six to nine months ahead, Tuesday's Dow activity is not good news.

The Dow officially entered bear market territory when a Tuesday morning decline drove the world's most followed stock market average beyond the level indicating a bear market -- down 20% from the October 9, 2007 high of 14,165.

What exactly is a 'bear market'?

Technical analysts, economists, and others argue that a 10% decline -- called a correction -- is a normal pull-back or pause in a bull market, a market where most stocks are likely to rise.

However, a 20% or greater decline is not healthy. Technical analysts say it indicates investors and traders are not simply taking short-term profits, but are concerned about the prospect for stocks in the quarters ahead -- three to nine months out -- and are exiting the market, in favor (historically) of bonds and cash.

For the above reason, 20% declines are usually interpreted by market advisors and participants as a sign that stocks are likely to be under pressure in the months ahead.

A key measure of U.S. economic activity continues to indicate a contraction.

The National Association of Purchasing Management-Chicago announced Monday that its business index rose just slightly this month, to 49.6 from from 49.1 in May.

Economists surveyed by Bloomberg News had expected the June reading to total 48.0. Readings above 50 indicate expansion; below 50, contraction.

Economist David H. Wang told BloggingStocks Monday the June PMI reading was roughly what he expected. "We did have a slight uptick, but overall we still see considerable concern expressed by businesses about rising fuel prices and other costs, and about the impact on the consumer," Wang said. "Businesses remain in defensive mode, for the most part, and there is little sign of a recovery."

That the U.S. economy has recorded a series of rather negative statistics lately, would not be a revelation to the informed investor / trader.

That the U.S. economy is set to record a new data point of ignominious distinction, perhaps would be.

Assuming a modest 50-point close higher or lower Monday, the Dow Jones Industrial Average will have declined about 9% in June 2008, its biggest drop in June since June 1930 in the Great Depression, when the Dow fell 18%.

At mid-day Monday, the Dow was up about 45 points to 11,390.95. The Dow is down about 3,000 points since trading above the 14,200 level in October 2007.

Stock analyst C. Leonard Bauer said "the Dow reflects the underlying economic reality."

Many negative fundamentals

'We have a smorgasbord of negative fundamentals. Housing is in a deep slump. Oil and gas prices are at 20-year highs. Corporate costs are rising. Disposable income is falling. Credit requirements are way up. Inflation is rising. And job growth doesn't look too good right now," Bauer said. "Other than that, as Groucho Marx would say, everything is fine economically."

Another factor weighing on stocks, at least for the near-term: 'sell in May and go away' - - the seasonal closing out of positions, particularly winning positions, Bauer said, as key decision makers at institutional banks and investment / hedge funds head for the Hamptons (Long Island, N.Y. ), the south of France, and other destinations, for the summer.

European business confidence declined more than forecast, the European Commission announced Friday -- an indication slowing euro-zone economy and rising inflation are beginning to lower business executives' expectations for the immediate quarters ahead.

The EC's sentiment index fell to 94.9 in May from 97.6 in April. It was the index's lowest reading since May 2005, Bloomberg News reported Friday.

Europe's major stock markets closed mixed Friday on the news. London's FTSE gained 11.70 points to 5529.90, Germany's DAX decline 37.69 to 6,421.91, and France's CAC 40 dropped 28.87 to 4,397.32.

Europe's execs: in defensive mode

London-based economist Mark Chandler told BloggingStocks that the slowdown in the United States, record oil prices, and rising inflation on the continent have but many of Europe's executives in defensive mode.

"Maybe the biggest concern is the impact of the slowdown in America and its affect on trade. Executives here are really concerned about a possible deeper U.S. recession dragging Europe lower. Their concern is well-rooted, because there's just not enough Asia demand to compensate," Chandler said. "Oil prices hitting $140 are another negative. It's not going to hurt the U.K. as much, but Europe could really be hurt by consumers cutting back spending on retail goods.

The Dow Jones Industrial Average is down 150 points (at 10:15 a.m.). I guess that it was to be expected as we woke up to news that Goldman Sachs (NYSE: GS) downgraded investment banks. Wall Street is also worried about the outlook for tech stocks after both RIM (NASDAQ: RIMM) and Oracle (NASDAQ: ORCL) reported quarterly results Wednesday, giving a tepid outlook.

Then, final revision of first quarter GDP were released an hour before the open, and while growth was revised upward to 1% from an anemic 0.6% original estimate, the components weren't very encouraging. Consumer spending, which accounts for 70% of GDP, grew by 1.1%, the smallest gain since the second quarter of 2001, which was during the last recession. Also, corporate profits after taxes fell 7.8%, a higher decline than previously estimated. Housing, as measured by residential fixed investment plunged by 24.6%.

Also, looking at inflation, the price index for gross domestic purchases, a closely watched measure of inflation, rose at a 3.6% rate, up 0.1 percentage point from the preliminary estimate. Excluding food and energy, the price index was up 2.3%, which is above the Fed's preferred range of around 1.5% to 2% for that index.

One bright spot, as it has been awhile now, is that exports rose 5.4%, which was much better than the estimate of 2.8 percent in May.

Moving to the labor markets, weekly initial claims, which were also reported at the same time, were unchanged. But -- and a big But it is -- the better indicator, four-week average of new jobless claims, was at the highest level since October 2005 in the aftermath of Hurricane Katrina.

New home sales in the U.S. fell 2.5% to a seasonally adjusted, annualized pace of 512,000 in May, with sales in the Western U.S. plunging to a 26-year low, the U.S. Commerce Department announced Wednesday (pdf).

Economists surveyed by Bloomberg News had expected May new home sales to register a 515,000 annualized rate.

Sales are still down about 40% compared to a year ago. In 2007, 776,000 new homes were sold, compared to 1.05 million in 2006.

Meanwhile, inventories rose to a 10.9-month supply in May at the current sales pace, compared to a 10.6-month supply in April. A typical, healthy housing market has a three to four month supply of homes for sale.

Sales fell in three regions: 11.6% in the West, 7.9% in the Northeast, and 5.1% in the Midwest. Sales rose a scant 0.4% in the South. Further, the West's 114,000 annualized sales pace was that region's slowest sales pace in 26 years.

U.S. durable goods orders were flat in May, as demand for airplanes and defense goods offset weakness in machinery and metals, the U.S. Commerce Department announced Wednesday.

Economists surveyed by Bloomberg News had expected May durable goods orders to remain flat. Durable goods orders decreased a revised 1.0% in April.

Equally significant, excluding the often-volatile transportation component, durable goods orders fell 0.9% in May. Also, excluding defense orders, durable goods orders declined 0.6%.

In May, shipments fell 1.1%, unfilled orders increased 0.9%, inventories increased 0.4%.

By category, in May orders for civilian aircraft jumped 10.3%, transportation increased 2.6%, computers and electronics climbed 2%, motor vehicles and parts declined 3.3%, transportation goods dropped 3.7%, and machinery declined 5.3%.

Foreign demand continues

Economist David H. Wang told BloggingStocks Wednesday exports continue to offset sluggish domestic demand conditions. "Export demand continued in the May report. It's helping keep U.S. businesses and factories busy during this down period in domestic demand," Wang said.

Former U.S. Federal Reserve Chairman Alan Greenspan believes financial market turmoil that disrupted the bond market and created liquidity concerns may extend into 2009, Bloomberg News reported Tuesday.

However, Greenspan said the Fed's efforts in March to revive credit have reduced instability. "Things do at this particular stage look a little bit better," Greenspan told Bloomberg News via a conference call, but added that financial doldrums are likely to linger a "good number of months or into next year."

Further, when asked if the U.S. economy was in a recession, Greenspan said, "We are on the brink," Reuters reported Tuesday.

Greenspan's remarks occur one day before the now Ben Bernanke-led Fed announces it interest rate decision, on Wednesday at 2:15 p.m. EDT. The Fed is widely expected to keep interest rates the same, while in its accompanying statement also striking a balance between concern over rising inflation and a pronounced economic stall.

U.S. consumer confidence declined to 50.4 in June -- the fifth lowest reading in the index's history -- as consumers continued to express concern over a stagnant economy and virtually non-existent job growth, The Conference Board announced Tuesday.

Economists surveyed by Bloomberg News had expected the index to drop to 56.5 in June. Consumer confidence index stood at 58.1 in May, 62.8 in April, 65.9 in March, and 76.4 in February.

The board said consumers' evaluation of present-day conditions weakened further in June. Those claiming business conditions are "bad" increased to 32.4% from 29.7%, while those claiming business conditions are "good" declined to 11.5% from 13.0%.

Consumers' assessment of the job market was considerably more pessimistic than last month. Those saying jobs are "hard to get" rose to 30.5% from 28.3, while those claiming jobs are "plentiful" decreased to 14.1% from 16.1%.

The decline in U.S. home values continues to accelerate, and the U.S. housing sector is showing few signs of a recovery.

Home prices in a 20-city sample plunged 15.3% in April, on a year-over-year basis, according to the S&P / Case-Shiller U.S. National Home Price survey. In March, prices in the 20-city sample declined 14.4%.

Economists surveyed by Bloomberg News had expected home prices in the 20-city Case-Shiller survey to decline 16.0% in April on a year-over-year basis.

Economist Peter Dawson said that while he doesn't expect this latest housing data point to sway the U.S. Federal Reserve regarding interest rates ahead of its Wednesday 2:15 p.m. EDT announcement, the continued housing price decline will highlight the headwinds facing the U.S. economy. "The house price declines will underscore to the Fed that while oil is feeding inflation, significant economic drags remain, and housing is the biggest drag, so the Fed has to be concerned about the potential for a pronounced economic stall," Dawson said. "They have to be careful to not raise interest rates too quickly and choke-off a recovery."