Stocks fall on growing fears over Eurozone

Fearing a financial rupture in Europe, investors around the world fled from risk Wednesday. They punished stocks and the euro, and the yield on a benchmark U.S. bond hit its lowest point since World War II.

In the United States, where concerns about Europe have already wiped out most of this year’s gains for stocks, major averages fell more than 1%. The Dow closed down 160.83 points, or 1.3%, at 12,419.86.

The Dow has had a miserable May, losing more than 6%, and is on track for its first losing month since September of last year.

With Spain’s banking system teetering and Greece’s political future unclear ahead of crucial elections next month, European stocks lost even more. The euro dropped below $1.24, to its lowest point since the summer of 2010.

“Everyone’s just afraid that if Europe doesn’t get its act together, there will be a big spillover in the U.S.,” said Peter Tchir, manager of the hedge fund TF Market Advisors.

He said the uncertainty over Europe’s future was reminiscent of the financial crisis in the fall of 2008, when it was briefly unclear whether banks would be bailed out and “we had these giant swings up and down.”

Facebook had a slightly hopeful morning Wednesday — its shares were a bit up. But at close the stock was trading down 65 cents, or 2.25%, to $28.19.