U.S. stocks slid for a second day after retailers from Wal-Mart Stores Inc. to Limited Brands Inc. said profit will trail forecasts as the recession limited holiday spending and sent continuing jobless claims to a 26-year high.

Wal-Mart, the world’s biggest retail chain, tumbled as much as 9.4 percent, the most in a year. Limited and Gap Inc. retreated more than 6 percent as weakening earnings outlooks at the clothing chains spurred concern that President-elect Barack Obama’s $775 billion in proposed government spending and tax cuts won’t prevent the economy from shrinking this year. Stocks fell on three of four days this week as the recession forced the biggest U.S. companies to acknowledge that forecasts made last year were too optimistic.

Earnings of S&P 500 companies have fallen for five straight quarters, matching the longest streaks of declines on record, and the slump is forecast to continue.

The total number of people receiving unemployment benefits rose to 4.6 million, the most since 1982, the Labor Department said, even as initial jobless claims unexpectedly fell by 24,000 to 467,000 in the week that ended Jan. 3. A report tomorrow will show the U.S. lost jobs for a 12th straight month in December, economists forecast.

The jobless-claims report came before Obama delivered a speech on the economic outlook in a bid to build support for his stimulus plan. Obama warned that the U.S. risks sinking deeper into an economic crisis without an infusion of government spending and urged Congress to act quickly on a stimulus package.