US stocks plunge on gloomy data

NEW YORK: US stocks fell sharply as markets opened Thursday, following reports indicating slowing growth in the United States and China, the world's two largest economies.

The Dow Jones Industrial Average fell 179.18 points (1.48 percent) to 11,930.49 in the first five minutes of trading.

The broader Standard & Poor's 500 dropped 19.33 points (1.50 percent) to 1,267.81, while the tech-heavy Nasdaq Composite tumbled 35.90 points (1.34 percent) to 2,633.29.

The drops came after the US Labor Department said initial jobless claims grew more than expected, rising to 429,000 in the week ending June 18, an increase of 9,000 from the prior week.

Separately, the HSBC China Manufacturing Purchasing Managers Index hit an 11-month low, falling to 50.1 in June from 51.6 in May, reflecting Beijing's efforts to cool the red-hot Chinese economy.

"Weaker than expected purchasing managers' surveys in China and Europe and the latest initial claims data are keeping the market imprisoned by thoughts that the temporary soft patch isn't so temporary," said Patrick O'Hare of Briefing.com.

Energy stocks took a beating as oil prices plummeted on fears of slowing global growth.

ExxonMobil fell 2.7 percent, while Chevron plunged 3.6 percent after the main crude contract traded in New York, West Texas Intermediate (WTI) for August delivery, fell more than four percent to below $91 a barrel.

Bond prices rose as investors flocked to safer assets.

The yield on the 10-year US Treasury note dropped to 2.92 percent from 2.99 percent on Wednesday, while that on the 30-year bond fell to 4.17 percent from 4.22 percent.

Bond prices and yields move in opposite directions.

Copyright AFP (Agence France-Presse), 2011