Global economic worries hit stocks
Renewed concerns about economic growth abroad — specifically Europe and China — weighed on markets Tuesday, causing U. S. stocks to erase all of the previous day’s gains.
The selling started in Asia, when a Chinese purchasing managers’ index for manufacturing declined to 49.4 last month from 49.7 in March. A number below 50 indicates that manufacturing is contracting. Worries about China were largely responsible for a bout of turmoil in global financial markets early this year.
Those concerns were compounded after European officials trimmed their economic growth forecasts for the 19 countries that share the euro currency, citing an unpredictable global outlook marked by political uncertainty and weakness in emerging markets.
The global economic worries caused more losses for two of the hardest- hit sectors in the U. S. stock market this year: energy and banks. Energy companies in the Standard & Poor’s 500 index slumped 2.2%, the most in the index, and financial stocks fell 1.3%.
Pfizer jumped 3% to $ 33.70 after reporting solid f irst- quarter earnings that beat analysts’ estimates. The f irm saw big sales gains in some of its newest drugs, including Lyrica and the vaccine Prevnar 13.
In energy, benchmark U. S. crude oil sank $ 1.13, or 2.5%, to $ 43.65 a barrel. Brent crude, the international standard, fell 86 cents, or 1.9%, to $ 44.97. Wholesale gasoline fell 5 cents to $ 1.51 a gallon, heating oil fell 2 cents to $ 1.33 a gallon and natural gas rose 4 cents to $ 2.086 per 1,000 cubic feet.
U. S. government bond prices rose sharply. The yield on the 10- year Treasury note fell to 1.80% from 1.87%. The euro fell to $ 1.1508 from $ 1.1523. The dollar rose to 106.47 yen from 106.45 yen.
Gold fell $ 4 to $ 1,291.80 an ounce. Silver fell 18 cents to $ 17.47 an ounce and copper fell 5 cents to $ 2.21 a pound.