World markets overnight: US share slide gathers momentum

Stocks on Wall Street reversed most of April’s gains as mixed economic data fuelled a selloff in technology and small-company shares that until recently had been strong performers.

The Dow Jones Industrial Average fell 195.01 points, or 1.1%, to 17,840.52; the S&P 500 index dropped 21.34 points, or 1%, to 2085.51; and the Nasdaq Composite Index shed 82.22 points, or 1.6%, to 4941.42.

Until this week, April had been a strong month for major benchmarks, with both the S&P 500 and the Nasdaq Composite notching all-time highs last week.

The Dow blue chips eked out a 0.4% gain in April, while the S&P 500 rose 0.85%.

The Nasdaq Biotechnology Index fell 3.1% and is down 8.1% this week. Before its recent pullback, it had gained as much as 21% for the year.

The Russell 2000 index of small-cap stocks lost 2.2% after gaining 5.5% this year through to last week’s high point.

Data showing the US economy grew just 0.2% during the first quarter was followed by a report that consumer spending also had a smaller-than-expected pickup in March.

However, on the p[ositive side, weekly jobless claims fell to the lowest level in 15 years and inflation undershot the Federal Reserve’s 2% target for the 35th month in a row.

Technology stocks fell sharply as Apple sank 2.7% following a report that a key component of the Apple Watch made by one of two suppliers was found to be defective.

International markets
European stocks rebounded from Wednesday’s steep losses. The Stoxx Europe 600 closed 0.4% lower, having dropped 2.2% previously. Germany’s DAX added 0.2%, while France’s CAC 40 gained 0.1%.

Shares in Asia were weaker. Japan’s Nikkei Stock Average tumbled 2.7% to 19,520.01 and Australia’s S&PASX 200 fell 0.8% to 5790, its third straight day of losses.

Hong Kong’s Hang Seng Index was down 0.9% and the Shanghai Composite was off 1.2%

Commodities and currencies
Gold prices saw their biggest daily drop in nearly two months on the more positive signs in the US economy. June futures, the most actively traded contract, closed down 2.3% at $US1,182.40 an ounce in New York, the biggest one-day decline since March 6.

Oil prices rose to a new 2015 high. Light, sweet crude for June delivery settled up $US1.05, or 1.8%, at $US59.63 a barrel. Prices rose 25% for the month, the largest monthly percentage gain since May 2009.
Brent crude, the global benchmark, rose 94USc, or 1.4%, to $US66.78 a barrel, the highest level since December 9. Prices rose 21% this month.

In currency trading, the euro surged to a two-month high against the US dollar of $US1.1256 before dropping back slightly to $US1.1180.

The Japanese yen strengthened to a one-month high after the central bank kept policy unchanged amid lingering speculation that further action may needed as the economy struggles.