Industrial stocks have led a broad decline on Wall Street as investors remain concerned about how the euro-zone's debt issues and weakening currency could hurt US company profits.
The Dow Jones Industrial Average closed 66.58 points, or 0.6%, down at 10,444.37. The measure's declines were led by its industrial components.
The industrial sector derives a sizable chunk of its revenue from Europe, and investors are concerned about how their earnings could be hurt by currency translations if the euro keeps sliding. Caterpillar dropped 3.8%, Boeing fell 3.1% and DuPont declined 2.1%.
The S&P 500 dropped 0.5% to 111.05. Earlier in the session, it hit an intraday low at 1100.46, just above the critical 1100 level could trigger further selling pressure.
The Nasdaq Composite finished 0.8% down at 2298.37.
Other markets: Europe, Asia down
European stock markets closed sharply lower, The main reason was the German ban on naked short selling of shares in 10 leading German financial institutions, in euro government bonds and in some related credit-default swaps.
The ban will run through to March next year and is aimed at curbing excessive price movements, effectively nobbling hedge funds and reducing the appetite for risk.
The pan-European Stoxx 600 index closed 3% lower at 243.82. The UK's FTSE 100 ended 2.8% lower at 5158.08, France's CAC-40 was off 2.9% at 3511.65 and Germany's DAX lost 2.8% to 5884.12
Asian markets ended broadly lower as foreign investors retreated. Exporters who sell their wares in Europe and resource stocks ranked among the day's big losers.
Southeast Asian markets were hit hardest. Indonesia's JSX Composite Index ended down 3.7% at 2729.48, Singapore's Straits Times Index shed 2.5% to 2774.54, Malaysia's Kuala Lumpur Composite Index slid 1.7% to 1308.23 and the Philippines PSE fell 1.3% to 3222.1.
In other markets, Japan's Nikkei Stock Average fell 0.5% to 10186.84, China's Shanghai Composite edged 0.3% lower to 2587.81, and Hong Kong's Hang Seng Index declined 1.8% to 19578.98.
Australia's S&P/ASX 200 fell 1.9% to 4387.10, and India's Sensex lost 2.8% to close at 16408.49.
Commodities: Oil, gold down
Crude-oil prices fell on fears the global economic recovery will be impared by Europe’s woes and cut into oil demand.
Light, sweet crude futures contract for June delivery is down 91USc, or 1.3%, at $US68.50 a barrel in New York. The contract expires on Thursday.
The more-active July contract is down $US1.19, or 1.6%, at $US71.51 a barrel. Brent crude on the ICE futures exchange fell $US1.20, or 1.6%, to $US73.23 a barrel.
Gold prices extended their decline as buyers retreated and the effects of Germany's shorts ban wore off.
The price of the most-actively traded gold futures contract for June delivery was down $US17.50, or 1.4%, at $US1197.10 an ounce in New York.
Currencies: Euro up
The euro rebounded strongly from four-year lows on market speculation that the European Central Bank could take steps to try to arrest the currency’s recent sharp decline.
The market talk comes as traders are circulating a report from a US think tank that is said to note that the G-7 nations are concerned about the speed of the euro's decline against the US dollar.
The report is also said to note that major central banks may be preparing a verbal intervention to support the currency "if the rout continues."
In recent trade, the euro was at $US1.2321 from $US1.2210 late on Tuesday in New York.
The dollar was at ¥91.12 from ¥92.34, while the euro was at ¥112.25 from ¥112.75. The UK pound was at $US1.4355 from $US1.4336.
Thu, 20 May 2010