Stocks open low as investors refocus on economy

Some retrenchment was to be expected after such a big advance, in which the Dow Jones industrials rallied more than 550 points, but the market’s pullback was relatively mild, especially since it also tested its October lows before surging higher Thursday.

Still, there were plenty of discouraging news for investors to focus on, including comments from Federal Reserve Chairman Ben Bernanke that the markets remain under “severe strain” and a sobering report on October retail sales.

The Fed chief said during a speech in Frankfurt, Germany, that he would work closely with other central banks to try to alleviate the global financial crisis and left open the door to a fresh interest rate cut. The Fed is scheduled to meet Dec. 16 at its last regularly scheduled meeting this year.

Meanwhile, the Commerce Department reported that retail sales plunged by the largest amount on record in October as consumers cut back on spending in the wake of the financial crisis. Retail sales fell by 2.8 percent last month, surpassing the old mark of a 2.65 percent drop in November 2001 in the wake of the terrorist attacks that year.

In the first hour of trading, the Dow shed 53.44, or 0.60 percent, to 8,781.81.

The Standard & Poor’s 500 index dropped 8.89, or 0.98 percent, to 902.40, and the Nasdaq composite index stumbled 24.37, or 1.53 percent, to 1,572.33.

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