Second-quarter GDP came out lower-than-expected at a 1.9 percent annualized rate, according the Commerce Department. First-quarter GDP was at 0.9 percent. The Commerce Department also reported a recession may have begun in the final three months of 2007, as GDP was revised downward to show a contraction of 0.2 percent. It marked the first drop since the recession of 2001.

A separate report from the Labor Department showed initial claims for unemployment insurance soared to the highest level in more than five years last week, rising by 44,000 to 448,000.

The stock market doesn’t like what it sees this morning, and futures are retreating after two days of gains. From a purely technical view, Lind Plus Senior Market Strategist Jeff Friedman says momentum readings, the stochastics and Relative Strength Index (RSI), remain neutral to slightly bullish, but a close above 1291 in the September S&P futures, the three-week high, would be needed to restore some confidence. A close below 1235 would open the door to further losses, possibly down to 1202.

“We may see a minor rally off these lows (today), but I think you have to sell any rally,” he said.