Wall Street tumbles on economic concerns, oil selloff
NEW YORK: US stocks tumbled on Thursday, with major indexes falling more than 1 percent and a volatility gauge spiking, as weak data on the labor market combined with a sharp decline in oil prices triggered a selloff.
Energy stocks took a hit after the International Energy Agency said it would release crude oil from its strategic reserves. US crude oil futures fell 5 percent to $90.85 a barrel.
The S&P energy sector dropped 3.3 percent while Chevron Corp fell about 4 percent to $97.16, the biggest decliner on the Dow. Exxon Mobil Corp was off 3.2 percent at $77.30.
The Dow Jones industrial average was down 173.08 points, or 1.43 percent, at 11,936.59. The Standard & Poor's 500 Index was down 19.81 points, or 1.54 percent, at 1,267.33. The Nasdaq Composite Index fwas down 38.66 points, or 1.45 percent, at 2,630.53.
New US claims for unemployment benefits rose more than expected last week, suggesting little improvement in the labor market this month after employment stumbled in May.
The data came a day after Federal Reserve Chairman Ben Bernanke gave a more pessimistic outlook on the economy, cutting the forecast for US economic growth and offering no hint of further monetary support. That prompted investors to sell after a four-day rally that lifted stocks from three-month lows.
The CBOE Volatility Index jumped 15.4 percent to 20.74.
Copyright Reuters, 2011
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