Stocks fall as Wal-Mart earnings disappoint

Stocks fell sharply Thursday as a disappointing earnings report from Wal-Mart and mixed economic data dragged major indexes lower for a second straight day.

The flight from stocks sent bond prices soaring as the yield on the 10-year Treasury note dropped below 2.5% for the first time this year.

The Dow Jones industrial average tumbled more than 175 points, dropping 1.1% in late morning trading. Wal-Mart was the biggest loser of the Dow 30 as the retailer reported a 5% drop in profits in the first quarter and missed analysts' estimates. Shares of the nation's largest retailer fell 2.4%.

The Standard & Poor's 500 index plunged 1.3% and the Nasdaq composite index was down 1.3%.

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The yield on the 10-year Treasury note fell to 2.48% from 2.54% late Wednesday.

In economic news, inflation picked up in April as consumer prices rose 0.3%. It was the largest jump in the consumer price index since last June.

Factory production in April dropped 0.4% following tow months of strong growth and homebuilder confidence lagged in May as the spring home-selling season got off to a slow start.

The number of people filing for jobless claims last week fell to the lowest level in seven years as initial claims for state unemployment benefits dropped 24,000 to a seasonally adjusted 297,000.

Asian stocks mostly drifted lower. India stocks came off slightly but remain near record levels. Tokyo's Nikkei 225 stock index fell 0.75% to 14,298.21. Hong King's Hang Seng index gained 0.7% to 22,730.86

European shares dropped. Germany's DAX index fell 1% and France's CAC 40 index tumbled 1.2%. London's FTSE 100 index was down 0.6%.

In the U.S. on Wednesday stocks pulled back from record levels. The S&P 500 fell 0.5% to 1,888.53 and the Dow dropped 0.6% to 16,613. The Nasdaq composite fell 0.7% to 4,100.63.