Wall Street sees steep sell-off
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E-mail Xinhua, June 2, 2012
Steep sell-off on Wall Street sent U. S. stocks and commodities down drastically on Friday as investors shunned risky assets amid weak jobs report and endless European debt woes. Stocks tumbled after the highly-anticipated report showed that recovery in the U.S. jobs market was sharply slowing down.
All ten S&P 500 large cap sectors and 96 percent of S&P 500 stocks went lower, signaling an across-the-board sell off.
When the market closed, the Dow Jones Industrial Average plunged 274.88 points, or 2.22 percent, to 12,118.57, wiping off all 2012 gains.
The Standard & Poor's 500 lost 32.29 points, or 2.46 percent, to 1,278.04 while the Nasdaq Composite Index tumbled 79.86 points, or 2.82 percent, to 2,747.48, both touching the lowest level since January.
In commodities market, light, sweet crude for July delivery dropped 3.30 dollars, or 3.81 percent, to settle at 83.23 dollars a barrel on the New York Mercantile Exchange, the lowest finish since October.
In London, Brent crude for July delivery also declined sharply and broke the mark of 100 dollars a barrel for the first time in eight months.
The steep decline came after the U.S. Labor Department said the country's economy added only 69,000 new jobs in May, the smallest gain in a year, while economists were expecting a much stronger increase.
Meanwhile, unemployment rate climbed to 8.2 percent from 8.1 percent in April, the first increase since June 2011.
A separate report from the Institute for Supply Management showed that U.S. manufacturing slowed in May, though a gauge of new orders rose to its highest in over a year.
Adding to the fears in the market, manufacturing data from both Europe and China also offered a bleak view for the global economy.
Manufacturing activity in Germany, France and Spain fell to their lowest levels since mid-2009 while China's manufacturing activity also fared worse than expected in May due to reduction in new orders.
EU's statistics office Eurostat said on Friday that euro zone unemployment hit a record high of 11 percent, warning jobless could climb further as the bloc's devastating debt crisis hurts business and leads to government layoffs.
Concerns over European debt woes continued to weigh on the market. The International Monetary Fund denied rumors that Spain has requested assistance, saying there are no plans to offer direct assistance to the struggling country.
Out of panic, investors fled to safe-haven assets like U.S. bonds, U.S. dollar and gold futures.
Yields of the U.S. benchmark 10-year note dropped below 1.5 percent for the first time ever and traded around 1.45 percent, highlighting panic among investors.
The U.S. dollar spiked to a fresh two-year high against the euro while gold futures rose above 1,600 dollars an ounce for the first time since May 2020.
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