IBT Staff Reporter

Stocks fell more than 1 percent on Thursday, starting the second half of 2010 on a weak note, as disappointing economic data underscored the view the recovery is slowing.

Goldman Sachs officials insisted demands for billions of dollars from insurer AIG ahead of a $182-billion government rescue package were based on legitimate market prices and denied gaming values for a massive payout.

The dollar fell to a seven-month low against the yen on Thursday as economic reports in both the United States and China added to investors' uncertainty about the global economic recovery. The euro, however, rallied broadly after European banks borrowed less money than expected from a European Central Bank's tender, cooling concerns over euro zone banks' funding issues.

A key survey of U.S. manufacturing activity fell to its lowest in six months, while contracts for pending sales of previously owned homes plunged a record 30 percent in May, far more than expected,

World stocks fell to three-week lows on Thursday and commodity prices sagged after data showing China's rapid growth was losing steam added to worries about the strength of the global economic recovery. Wall Street looked set to track Asian and European peers lower with U.S. stock index futures all in the red.

Amazon.com Inc cut the price on its most expensive Kindle electronic reader, the latest salvo in a price war in response to Apple Inc's pricier iPad tablet computer.

Global carmakers are braced for a slide in second half sales as scrappage schemes are phased out and cautious consumers pull back from big-ticket buys in the face of economic uncertainty.

China's foreign ministry said on Thursday it had no comment on Google's decision to end automatic rerouting of users to its uncensored Hong Kong search portal, but that all Internet operators had to abide by local laws.

A U.S. scientific panel will conduct a broad review of vehicle electronics to see if they pose safety risks, an investigation prompted by massive Toyota Motor Corp recalls for unintended acceleration.

U.S. auto sales for June slipped from the pace of recent months, analysts say, raising doubts about whether the industry's recovery is faltering even before it delivers the second-half upturn automakers expected.

Ford Motor Co said it is paying $3.8 billion in cash to settle a debt to a health care trust in a signal of its confidence that it remains on track to deliver solid profits this year.

Tesla Motors Inc underwriters sold an additional 2 million shares in the electric carmaker on much stronger than expected demand for stock of the still-unprofitable company

The dollar touched a seven-month low against the yen on Thursday as Chinese and U.S. economic reports added to investors' uncertainty about the global economic recovery. Chinese manufacturing PMI data showed slower growth in June, heightening concerns over the global economic recovery and weighing on high-yielding currencies.

Gold prices dropped toward $1,220 an ounce on Thursday, caught up in selling of other assets like equities and industrial commodities after U.S. economic data disappointed the financial markets. The metal is expected to extend its recent gains in the medium term, however, after outperforming most other commodities and all other metals in the second quarter as investors turned to bullion as a haven from risk in the wider markets.

General Motors Co reported a 10.7 percent rise in June U.S. sales, helped by strong demand for newly launched vehicles such as the Chevrolet Equinox crossover and a recovery in truck sales.

Details of Europe-wide testing of banks' financial vulnerabilities are still being worked out as an end-of-July deadline to publish the stress test results for individual banks looms, the Bundesbank said on Thursday.

Goldman Sachs demanded billions of dollars in collateral from AIG to protect its customers, the Wall Street bank said on Thursday, defending itself against accusations that it contributed to the insurer's woes while padding its own profits.

New claims for state jobless benefits unexpectedly rose last week, while manufacturing activity and employment slowed in June, heightening fears the U.S. economic recovery is stalling.

Wall Street suffered losses for a fourth straight day on Thursday as disappointing home sales, manufacturing and jobless data raised new doubts about growth in major sectors of the economy and prompted a sharp pullback from riskier assets.

Goldman Sachs demanded billions of dollars in collateral from AIG to protect its customers, the Wall Street bank said on Thursday, defending itself against accusations that it contributed to the insurer's woes while padding its own profits.

Normal monsoon not only augurs well for the Indian agriculture sector but also generate a bullish scenario for silver as out of total demand for the white metal in the country, 60% is contributed by the farming community.

Toyota Motor Corp by Thursday morning had not yet alerted U.S. safety regulators of a recall of Toyota and Lexus models for possible engine stalling while driving, a NHTSA official said.

The dollar extended losses against the euro on Thursday after data showed business activity in the U.S. manufacturing sector came in weaker than expected in June.

A European Union court backed an EU antitrust decision against Anglo-Swedish drugmaker AstraZeneca Thursday, lending weight to a regulatory crackdown on firms blocking cheaper drugs coming to market.

Asian and European manufacturing output growth cooled further in June, with China hitting its slowest pace in more than a year -- further evidence that the global economic recovery is moderating.

The dollar extended declines against the yen on Thursday after data showed initial U.S. weekly jobless claims came in higher than expected.

Asset managers are ramping up their presence in Asia to tap the cash of the growing middle class but some industry managers are warning that the quick bucks these funds are chasing may be elusive.

The Treasury Department said on Thursday it so far has taken in gross proceeds of $10.5 billion from the sale of 2.6 billion Citigroup shares under a written trading plan.

The dollar extended declines against the yen on Thursday after data showed initial U.S. weekly jobless claims came in higher than expected. The dollar dropped to 87.49 yen JPY= after the data from around 87.61 prior to the release of the data. The euro fell to $1.2357 EUR= from $1.2369 prior to the data's release. The euro had already risen 1 percent against the dollar before the data's release.