May 13th, 2010
10:43 PM ET

Stocks slump as investors step back

A look at highlights from the day's business news:

Stocks slump as investors step back after three days of growth

Stocks slumped Thursday, with the Dow losing 114 points as investors stepped back after propelling markets 5 percent higher earlier this week.

The dollar strengthened versus the euro, dragging down dollar-traded oil,
gold prices and stocks. The Dow Jones industrial average lost 114 points, or 1%. The S&P 500 index lost 14 points, or 1.2% and the Nasdaq composite lost 30 points, or 1.3%.

Stocks rallied Monday and Wednesday as investors moved away from worries about Europe's debt crisis spreading and instead opted to scoop up issues hit in last week's massive sell off. Tuesday brought some selling, but it wasn't enough to take away from the week's gains. 

After such an advance, stocks were adrift through most of Thursday, before turning lower near the close.

Oil slips on increased supply

Oil prices slid in global trading Thursday as investors continued reacting to growing U.S. inventories reported by the government and concerns of economic instability in Europe.

Crude for June delivery slipped $1.25, or about 1.65%, to settle at $74.40  a barrel Thursday. Gasoline prices at the pump fell for the seventh day in a row, slipping to $2.890 a gallon from $2.896 the day before, according to a survey by motorist group AAA.

On Wednesday, the U.S. Energy Information Administration showed oil supplies last week grew more than expected across all three major categories: crude, gasoline and distillates. One stockpile in particular, in Cushing, Oklahoma, grew to a record high 37 million barrels.

Euro suffers on austerity concerns

The dollar turned higher against the euro and pound Thursday, as investors turned back to long-term debt problems in Europe and mulled major budget cuts in several countries.

The dollar rose 0.7% against the euro to $1.2522 and plunged 1.5% versus the pound to $1.4598. The U.S. currency was down 0.5% against the Japanese yen at ¥92.73.

The euro had soared Monday on the announcement of a nearly $1 trillion European rescue package. But by Thursday, investors had turned back to long-term problems in the zone and worried whether countries' major budget cuts would be enough to fix their debt issues.

Treasurys edge higher ahead of auction

Treasurys were mostly higher Thursday ahead of a $16 billion auction of 30-year notes. 

The benchmark 10-year note was the one exception, falling 29/32 to 99-17/32 and yielding 3.56 percent. Bond prices and yields more in opposite directions.

 The 30-year bond rose 10/32 to 102-22/32, pushing the yield down to 4.46 percent. Bond prices and yields move in opposite directions. The 2-year note climbed 8/32 to 100-9/32 with a 0.86 percent yield. The 5-year note edged up to 101-2/32, yielding 2.28 percent.

CNNMoney.com reporters Alexandra Twin, Julianne Pepitone, Blake Ellis and Annalyn Censky contributed to this report.

Post by:
Filed under: Economy
soundoff (No Responses)

Comments are closed.