Mid-Day Report

An increase in the unemployment rate along with flat manufacturing activity weighed down the markets during the midday with the Dow dropping 59 points to 11,319. Nasdaq tumbled 19 points to 2307.

On the upside

Ambac (NYSE: ABK) will pay $850 million to settle its exposure to $1.4 billion in collateralized debt obligations.

Boyd Gaming (NYSE: BYD) reported lower second quarter earnings due to the weak economy but the results topped expectations and the casino operator increased its stock repurchase plan by $100 million.

Thoratec (Nasdaq: THOR) reported sharply higher second quarter earnings as revenue surged.

On the downside

TomoTherapy (Nasdaq: TOMO) disappointed with a second quarter loss amidst challenging economic conditions and lowered its full year outlook.

Sun Microsystems (Nasdaq: JAVA) blamed the weak economy as well as restructuring charges for sharply lower fourth quarter earnings and forecast disappointing first quarter results.

Paetec Holding (Nasdaq: PAET) warned that second quarter sales will fall short of estimates and full year results will also disappoint.

In the broad market, declining issues outpaced advancers by a margin of nearly 9 to 7 on the NYSE and by nearly 10 to 9 on Nasdaq. The Russell 2000 which tracks small cap stocks added a point to 716.