The US markets extending losses into a fourth session slipped further on Thursday, after European Central Bank President Mario Draghi failed to deliver immediate action to stem the region's debt crisis. While on domestic front, factory orders unexpectedly fell in June, the latest sign that the slowing economy is sapping demand. Orders for manufactured goods decreased 0.5% to $465.81 billion. Factory orders have declined during three out of the past four months, with May's increase revised down to 0.5% from an initial estimate of 0.7%. However, the government reported jobless claims which rose by 8,000 to 365,000 last week, with the four-week claims average dropping by 2,750 to 365,500, the lowest since March. Applications for unemployment benefits rose slightly last week, but the number of people seeking compensation appears to have settled in a range that suggests little change in the rate of US job growth. The US probably added enough new jobs in July to soak up the increase in the labor force, but the pace of hiring is far too slow to lower the nation's high unemployment rate.

In Europe, ECB President Mario Draghi indicated the ECB plans to unite with governments in purchasing bonds in large enough quantities to curb the euro land's debt trouble, although he conceded Germany's Bundesbank was not fully on board with the concept. ECB President Mario Draghi further stated that the institution might intervene in bond markets to help bring down borrowing costs for struggling euro-zone countries, but will only act after governments ask for help from the region's rescue funds, disappointing investors banking on immediate action. Investors have started anticipating that Draghi's decision to postpone action by demanding euro-zone governments turn to existing rescue funds before the ECB intervenes may worsen the crisis.

The Dow Jones industrial average lost 92.18 points, or 0.71 percent, to 12,878.90. The S&P 500 Index lost 10.14 points, or 0.74 percent, to 1,365.00, while the Nasdaq Composite was down by 10.44 points, or 0.36 percent, to 2,909.77.

The Indian ADRs closed mixed on Thursday, ICICI Bank was down 0.82%, Infosys was down 0.66%, Tata Motors was down 0.46% and Sterlite Industries was down 0.26%. On the flip side, Dr. Reddy's Lab was up 0.34%.