Stocks on Wall Street and in Europe declined amid concern about US growth after a larger-than-expected number of Americans filed for unemployment benefits, plus drop in existing home sales and disappointing factory activity.
BUSINESSDESK: Stocks on Wall Street and in Europe declined amid concern about US growth after reports that a larger-than-expected number of Americans filed for unemployment benefits, and an unexpected drop in sales of existing homes and disappointing factory activity in the mid-Atlantic region.
The numbers underpinned the view that the pace of expansion in the world's largest economy is easing.
Jobless claims fell by 2000 to 386,000 in the week ended April 14 from a revised 388,000 the previous period, according to Labor Department figures.
The median forecast of a Bloomberg News survey was for a drop to 370,000.
“The economy has slowed a notch,” Ryan Sweet, a senior economist at Moody’s Analytics in West Chester, Pennsylvania, told Bloomberg.
“We’re just not going to be able to duplicate the growth we saw in the first quarter.”
In afternoon trading in New York, the Dow Jones Industrial Average shed 1.03%, the Standard & Poor's 500 Index fell 0.71% and the Nasdaq Composite Index slid 0.77%.
US corporate results also raised a few question marks. Qualcomm's sales and profit outlook fell short of expectations.
There were, however, positive surprises, too.
Shares of eBay surged 14% on its first-quarter earnings. It also raised its 2012 forecasts, citing growth in its Marketplaces and PayPal businesses.
In Europe, the Stoxx 600 index ended the day with a 0.5% decline for the session.
The euro zone's debt crisis hangs over the market. France and Spain, each at risk under heavy debt loads and rising borrowing costs, managed to sell a combined 13.05 billion euros in debt today.
Spain sold 2.54 billion euros of two- and 10-year securities and France raised 10.5 billion euros in debt out of an 11 billion-euro goal, according to Bloomberg.
The yield on the 10-year Spanish benchmark was 5.743% compared to 5.403% when it last sold it in January.
France’s five-year notes had an average yield of 1.83% today, up from 1.78% on March 15.
While there was good demand for the latest French and Spanish bond auctions, investors remain wary of whether the situation is being controlled
Meanwhile, the International Monetary Fund has secured about $US320 billion in commitments for new money to help control the impact of the European Union's sovereign debt crisis.
That is still short of the $US400 billion IMF chief Christine Lagarde is seeking, which is already down from her initial $US600 billion target.
"We expect our firepower to be significantly increased as an outcome of this meeting," Lagarde said at a news conference to kick off the spring meetings of the IMF and World Bank, Reuters reported.
