Stocks prepare for a drubbing

NEW YORK (CNNMoney.com) -- U.S. stocks were poised to extend losses Thursday, as investors eye jobless claims at a 16-year high and Saudi prince Alwaleed increasing his stake in Citigroup.

A rout on Wall Street Wednesday sent the blue-chip average below 8,000 for the first time since 2003.

At 8:50 a.m. ET, Dow Jones industrial average, Standard & Poor's 500 and Nasdaq 100 futures were lower.

Stock futures measure current index values against perceived future performance and give an indication of how Wall Street will open when trading begins in New York.

Before the open, Saudi Prince and long-time Citigroup (C, Fortune 500) investor Alwaleed Bin Talal said he increased his stake to 5% following the U.S. government's $25 billion bailout for the troubled bank. Before the bailout, the prince held a 4% stake.

Also, the Labor Department announced that first-time jobless claims during the week ended Nov. 15 surged to 542,000, a 16-year high. This trumps expectations of 505,000 jobless claims, from a consensus of economist projections compiled by Briefing.com. In the prior week, jobless claims totaled 516,000.

U.S. stocks fell sharply Wednesday as economic fears and uncertainty about the future of the auto industry pummeled the market. The Dow lost 5%, while the Standard & Poor's 500 (SPX) index slid 6% to its lowest level since March 2003. And the Nasdaq composite (COMP) lost 6.5% to settle at its lowest point since April 2003.

"New lows in the S&P and Nasdaq were made yesterday," said Peter Cardillo, analyst for Avalon Partners. "There's a continuation of negative news that is going to continue to weigh on the market. Oil prices are hitting new lows, and there's a flight to quality to gold."

Cardillo said the new multi-year lows for the stock indexes are a "major negative setback, from a psychological effect."

Overseas markets took a cue from Wall Street. Major Asian markets posted heavy losses, with Japan's Nikkei losing nearly 7%. European shares were solidly in negative territory in morning trading.

Auto bailout: Senate Majority Leader Harry Reid called off a planned vote this week on a $25 billion auto industry bailout.

The chiefs of General Motors (GM, Fortune 500), Ford Motors (F, Fortune 500) and Chrysler have been on Capitol Hill this week to plead for aid. They have found some support in Congress but have also faced heavy criticism.

On Thursday, GMAC Financial Services, a subsidiary of General Motors which holds 49% of its stock, applied to the Federal Reserve to become a bank holding company. In this way, GMAC is trying to tap into the $700 billion bank bailout from the Troubled Asset Relief Program, which has so far been denied to automakers.

Economy: A reading on leading economic indicators comes out at 10 a.m. ET. For this index on previously-announced economic reports, the Conference Board is expected to report a 0.7% dip in economic activity in October, according to a consensus of economists compiled by Briefing.com.

The Philadelphia Fed's survey of regional manufacturing activity is also due out at 10 a.m. ET. The Philadelphia Federal Reserve Bank is expected to announce a 35-point decline for its November index measuring industrial factors like new orders and employment, according to a consensus of economist opinion from Briefing.com.

Companies: The personal computer maker Dell (DELL, Fortune 500) is due to report its financial results after the market close. The company is expected to post a 9% drop in earnings to 31 cents per share, according to a consensus of analysts surveyed by Briefing.com.

Money and oil: The U.S. dollar rose against the British pound, but slipped versus the euro and the yen. Oil continues to plunge, momentarily dipping below the $50 mark. At 9am oil prices were trading about $3.22 lower to $50.40 barrel.