Publications
Partners
New York - World stocks and oil slumped for a second straight day on Thursday as the latest US economic data kept investors on the edge, with a slight drop in claims for jobless benefits not enough to assuage fears about the economy's path.
The dollar fell to a one-month low against the euro as Greece agreed to new measures to cut its deficit, mitigating fears over its debt crisis and making investors shift their focus to the US economy.
On Wall Street, the benchmark Standard & Poor's 500 index fell below its May low as investors reacted to the data on jobless claims. First-time claims for jobless benefits in the latest week fell by 6 000 to 422 000. The figure was below expectations for a decline to 415 000.
"Every indication we have had so far points to a slightly softer labor market in the US," said Camilla Sutton, chief currency strategist at Scotia Capital in Toronto.
Nervous investors honed in on key market levels to manage risk a day after stocks suffered their worst one-day fall in nearly a year.
Appetite for risk-taking had been on the decline since late May due to lackluster data from both emerging and developed economies.
"We've been through a couple week period here where basically every piece of economic data has just been awful," said John Canally, investment strategist and economist for LP Financial in Boston.
The Dow Jones industrial average was down 78.29 points, or 0.64%, at 12 211.85. The Standard & Poor's 500 Index was down 6.28 points, or 0.48%, at 1 308.27. The Nasdaq Composite Index was down 4.25 points, or 0.15%, at 2 764.94.
Dollar, oil down; Bonds ease
With the US Federal Reserve set to wrap up its $600bn bond buying program later this month, signals of more economic weakness ahead are especially worrying to investors involved in riskier assets such as equities, high-yield bonds and emerging markets.
The MSCI index of global equities fell 1.01%.
European shares fell to a one-week closing low as the US data raised concerns about the pace of recovery in the world's biggest economy.
The FTSEurofirst 300 index of top European shares provisionally finished 1.2% lower at 1 117.09 points - the lowest close since May 23.
The euro jumped 1% against the dollar to a one-month high on optimism that European officials will reach an agreement on how to help Greece repay its debt.
The growth unease has seen investors pile into safe-haven US and German bonds, with US 10-year yields falling under 3% on Wednesday for the first time since last December.
Treasuries dipped slightly as investors cashed in on recent gains, pushing up the benchmark 10-year yield 3.1 basis points. But the yield stayed under 3% and is unlikely to rise much in the current environment.
