Wall Street declined on Thursday, with the S&P 500 posting its worst daily fall since April and its first monthly drop since January, as economic data sparked concern the Federal Reserve could raise interest rates sooner than some have expected.
The Dow Jones industrial average fell 317 points or 1.88%, to 16,563, while the S&P 500 lost 39 points or 2.0%, to 1,931 and the Nasdaq Composite dropped 93 points or 2.09%, to 4,370. For the month, the Dow was down 1.6%, the S&P 500 was down 1.5%, and the Nasdaq was down 0.9%.
Economic data showed that US labour costs recorded their biggest gain in more than 5-1/2 years in the second quarter this year. The figures came out a day after the Fed upgraded its assessment of the US economy while reiterating it was in no hurry to raise rates.
Problems in overseas economies added to the bearish tone, with Argentina defaulting on its debt for the second time in 12 years.
In Russia, news agencies reported that Russia banned soy imports from Ukraine and may restrict Greek fruit and US poultry in what could be responses to new Western sanctions over Ukraine.
Energy sector led the decline in the broader market with Exxon Mobil Corp (XOM.N) falling 4.2% after its second-quarter earnings beat expectations but oil production dropped. Murphy Oil fell 6.9% after the oil and natural gas company lowered its full-year production forecast as second-quarter earnings trailed analysts’ estimates.
In after hours trade, shares of LinkedIn (LNKD.N) jumped 8.9% when the corporate networking site reported a 47% increase in quarterly revenue and forecast better-than-expected adjusted profit and revenue in the current quarter.
During the regular session, Kraft Foods Group (KRFT.O) shares fell 6.4% after it reported late on Wednesday a scant rise in quarterly revenue.
Elsewhere, Micron fell 6.1% after earnings from Samsung Electronics Co., the world’s biggest smartphone maker, trailed estimates.
In Asia, shares fell on Friday extending the biggest global rout in six months that saw the Dow Jones wipe out this year’s gains in one session amid weaker earnings and credit-market concerns.
The MSCI Asia Pacific Index fell 0.7% to 148 as of 10:03 a.m. in Hong Kong. Japan’s Topix index declined 0.4%. Australia’s S&P/ASX 200 Index slumped 1.4%, heading for its biggest loss since mid March. New Zealand’s NZX 50 Index dropped 0.8%, while Singapore’s Straits Times Index and Taiwan’s Taiex index both retreated 0.7%.Hong Kong’s Hang Seng Index slipped 0.4%. China’s Shanghai Composite Index was little changed, while South Korea’s Kospi index added 0.1%.