U.S. stocks dropped Thursday, as weakness in the jobs figures and in European economic data knocked blue chips into the red for the second-straight session.

The Dow Jones Industrial Average closed down 77 points, or 0.7%, at 10662, as a late swoon pushed the index lower after spending much of the day oscillating between slim gains and losses.

It was the second straight session in the red and the biggest one day decline since Sept. 7. Still, the measure remains up 6.5% for the month, and 2.3% for the year, outperforming what had been expected to be a weak September.

Walt Disney was the weakest Dow component, falling 87 cents, or 2.6%, to 33.12. It was closely followed lower by General Electric, which lost 36 cents, or 2.2%, to 16.14, and J.P. Morgan Chase, which fell 84 cents, or 2.1%, to 39.10.

The Standard & Poor's 500 stock index fell 9.5 points, or 0.8% to 1125 and the Nasdaq Composite fell 7.5 points, or 0.3%, to 2327. Both the S&P 500 and the Nasdaq have now fallen for three straight sessions, though they remain up 7.2% and 10% this month, respectively.

Varying sets of data had lead to the back and forth trading Thursday, as the morning's report on jobless claims was worse than expected and data on the pace of growth in the euro zone was disappointing.

The more positive side of stronger than expected gain in existing home sales last month failed to prove strong enough to push the fears aside. Overseas, Ireland posted a surprise decline in second quarter gross domestic product and surveys raised concerns about economic strength in Europe.

The Irish economy's contraction in the three months to June fueled worries across Europe and beyond about the efficacy of austerity measures in tackling the high levels of public sector debt that many governments have incurred during the financial crisis and the recession that followed.

Meanwhile, Germany's private sector expanded at a much slower pace this month, and the euro zone PMI data suggested the area's economy is slowing down even more rapidly than had been forecast.

European market

European stocks pared their losses to finish slightly lower Thursday after positive U.S. housing data partially offset worries over Ireland's financial health and euro zone growth.

The Stoxx Europe 600 index fell 0.05% to end at 261.07 after hitting an intraday low of 258.14. Stocks absorbed a clutch of U.S. data, including a rebound in existing-home sales in August. On the negative side, another report showed a rise in weekly claims for unemployment benefits.

The French CAC 40 index dropped 0.7% to 3,710.61, with banks leading the action. Natixis SA fell 3.4%, BNP Paribas SA slipped 2.5% and Credit Agricole SA dropped 1.9%. The German DAX 30 index declined 0.4% to 6,184.71.

Shares of Deutsche Post AG fell 1.9% and Commerzbank AG dropped 1.5%. Weighing on sentiment for Europe much of the day was a euro-zone survey of purchasing managers for September showing that activity was the slowest in seven months. The Markit composite PMI index fell to 53.8 from 56.2 in August.

Ireland reported a 1.2% drop in gross domestic product in the second quarter compared with the preceding three months, underscoring the nation's economic crisis. Ireland's ISEQ stock index dropped 0.9%, while the FTSE 100 index edged down 0.1% to 5,547.08.

Shares of Lloyds Banking Group PLC slipped 1%, while shares of Anglo American PLC ending down 0.4% and Kazakhmys PLC dropped 0.9%.

Asian market

Asian stock markets ended mixed Thursday with Australian miners rising on stronger metals prices, while Thai telecommunications firms fell after a court ruling dashed hopes that an auction for a 3G wireless spectrum would proceed.

Taiwan's Taiex rose 0.1%, while Singapore's Straits Times fell 0.4%. Trading activity was modest as markets in Japan, South Korea, China and Hong Kong were shut to mark autumn holidays.

Telecommunications shares in Thailand were lower after the country's Supreme Administrative Court upheld a lower court's injunction against a long awaited plan for the auctioning of third-generation mobile licenses. Advanced Info Service was down 1.1%, Total Access Communication fell 1.3% and True Corp slid 8.1%.

The Central Administrative Court issued the injunction a week ago after state owned operators challenged the legitimacy of the National Telecommunications Commission to allocate the 2.1 gigahertz frequency spectrum used for 3G services, pending the commissioning of a new regulator.

Base metals

Base metals closed higher on the London Metal Exchange Thursday as expectations of tightening fundamentals outweighed selling pressure from disappointing U.S. data and a firmer dollar.

Further weakness in the U.S. labor market was shown in the greater than expected number of people filing new claims for jobless benefits last week, but the news did little to damp sentiment in the metals, analysts noted, with copper climbing to fresh five month highs.

The red metal reached an intraday high of $7,909 a metric ton heading into the kerb close, also undeterred by the strengthening dollar. The U.S. currency has struggled in recent sessions, helping to drive a rally across the dollar denominated metals.

Crude futures rebounded Thursday, helped by a rise in fuel product prices after a major refinery shutdown overshadowed worries about the sluggish economy.

Light, sweet crude for November delivery settled 47 cents, or 0.6%, higher at $75.18 a barrel on the New York Mercantile Exchange, after falling as low as $73.58 earlier in the session. Brent crude on the ICE futures exchange settled 16 cents higher at $78.11 a barrel.

Oil prices were buoyed by a rise in gasoline and heating oil futures. ConocoPhillips (COP) said it recently halted crude oil processing operations at its oil refinery in Linden, N.J., to install new equipment.

The 238,000 barrel a day refinery is expected to restart oil processing around Nov. 4. Gold futures ended at another record settlement price as investors bet that prices will continue to rise amid an uncertain economic recovery and the chance of further easing of U.S. monetary policy.

The most actively traded gold contract, for December delivery, rose $4.20, or 0.3%, to $1,296.30 an ounce on the Comex division of the New York Mercantile Exchange.

The benchmark contract has settled at record highs in six of the last eight sessions, buoyed by speculation that the Federal Reserve will flood the market with cash to boost the sagging economic recovery, a move seen devaluing the dollar and enhancing gold's appeal as an alternative asset.