Stock markets worldwide slumped the lowest levels this year as fears rose the global recovery is petering out.On Wall Street, the blue chip Dow Jones Industrial Average closed below 10,000, sinking 268.06 points, or 2.6%, to 9870.30.Traders stampeded into
Stock markets worldwide slumped the lowest levels this year as fears rose the global recovery is petering out.
On Wall Street, the blue chip Dow Jones Industrial Average closed below 10,000, sinking 268.06 points, or 2.6%, to 9870.30.
Traders stampeded into the safe-haven currencies – the yen and the US dollar – while bond markets strengthened. Oil fell and gold rose.
A raft of issues confronted investors: fallout from the end of the European Central Bank's special bank lending programme; the US Conference Board's Chinese leading indicator for April was revised sharply lower; and the same group's US consumer confidence gauge tumbled in June.
On the bond market, US Treasurys sent the yield on the 10-year note below 3%, to its lowest level in more than a year.
All 30 of the Dow's components were in the red, led by a 6.3% drop in Boeing and Alcoa. Caterpillar tumbled 5.5% while Amex fell 4.8%, Microsoft 4.1% and Cisco 3.6%.
The broader S&P 500 index closed 3.1% down at 1041.25, eclipsing its previous low for the year of 1050.47 on June 7. All of the sectors were negative, led by declines in the riskier industrials, technology and financial sectors. Safer consumer-staples and healthcare stocks posted the smallest losses.
The Nasdaq Composite slumped 3.85% to 2135.18, stung by a 4.5% drop in Apple and a 7.8% decline in Amazon.com.
Other markets: Europe, Asia down
Stocks in Europe slumped in the worst single-day decline in more than a month.
The Stoxx Europe 600 dropped 3% to 243.82, more than eliminating Monday's advance. dragged down in particular by companies exposed to China.
ArcelorMittal, the world's top steelmaker, dropped 6.3% and Rio Tinto fell 6.4%. Financials also suffered, with Spanish bank BBVA dropping 6.9%.
All the major indexes suffered. The UK FTSE 100 dropped below the 5000 mark, retreating 3.1% to 4914.22 and the German DAX fell below the 6000 level, rshedding 3.3% to 5952.03. The French CAC 40 fell 4% to 3432.99.
In Asia, China shares fell sharply, hitting a 14-month intraday low and pushing all other regional markets down.
Japanese shares were also hit as the higher yen dragged on the nation's exporters, while resource stocks stumbled across the region on concerns about the demand outlook.
China's Shanghai Composite reversed early gains to tumble 4.3% for its worst percentage fall in more than a month to end at 2427.05, its lowest finish since April 2009.
The sharp reversal also helped pull down other regional markets, with Hong Kong's Hang Seng Index dropping 2.3% to 20,248.90, Japan's Nikkei Stock Average shedding 1.3% to 9570.67 and Korea's Kospi losing 1.4% tp 1707.76.
Australia's S&P/ASX declined 0.9% to 4345.67, Taiwan's Taiex slid 1% to 7423.57, India's Sensex gave up 1.3% to 17,534.09 and Singapore's Straits Times dropped 1.4% to 2830.34.
Commodities: Oil down, gold up
Crude-oil futures fell sharply as investors avoided commodities and other assets seen as risks amid continued indications of a sluggish economic recovery.
Light, sweet crude for August delivery settled $US2.31, or 3%, lower at $US75.94 a barrel in New York. Prices moved in a range of $US75.66 to $US78.32 a barrel. August North Sea Brent crude on the ICE futures exchange traded $US2.35 lower at $US75.24 a barrel.
Gold futures rose as equities fell. The most-actively traded gold contract, for August delivery, settled $US3.80, or 0.3%, up at $US1242.40 an ounce in New York. The closer June contract settled at $US1242 an ounce.
Currencies: Yen, dollar up
The dollar and the yen rose as traders stampeded out of risk-sensitive currencies such as the euro.
Growth-sensitive currencies such as the Australian, New Zealand and Canadian dollars also fell.
The safe-haven yen bested the dollar and just about every other currency.
The euro slipped to a low against the Swiss franc and its lowest level since November 2001 against the yen.
The euro was at $US1.2189 from $US1.2274 late on Monday. The dollar fell to ¥88.42 from ¥89.40, while the euro was at ¥107.74 from ¥109.73.
The dollar was at 1.0812 Swiss francs from 1.0872 francs, while the pound slipped to $US1.5088 from $US1.5110 late on Monday.
