U.S. stocks headed for a three-week low as concern that global growth remains tepid sent equities lower from Europe to developing nations. Crude wiped out an advance, while the dollar strengthened for a second day after falling to the lowest in almost a year.
The S&P 500 Index fell for the fourth time in five days, with industrial shares losing more than 1 percent as an 18 percent run from February lows faltered. European shares slid a fourth day as earnings failed to lift investor sentiment. Emerging-market equities sank and the dollar climbed from a June low amid speculation on the timing of higher interest rates. Treasuries fluctuated, and oil erased an increase after a report showed crude inventories rose in the U.S. last week.
The rally in global equities stumbled into a second week as data from Europe to America failed to alleviate concern that economic growth is slowing and corporate profits will contract. At the same time, comments from Federal Reserve officials raised the specter for higher rates even as economic reports paint a mixed picture on the state of the world’s largest economy ahead of a government jobs report Friday.
“Data has been a mixed bag today, starting with some disappointing employment figures that gave way slightly to some better-than-expected numbers,” said Chad Morganlander, a Florham Park, New Jersey-based money manager at Stifel, Nicolaus & Co., which oversees about $170 billion. “We expect the market to see some volatility going forward, with a downward bias as investors look for the next positive sign.”
U.S. reports Wednesday showed service companies expanded last month at the fastest pace in four months, while fewer jobs were added than projected. A report from Markit Economics indicated that European Central Bank policy is helping to sustain growth in the euro area economy, though the pace is “tepid” and inflation remains too low.
The S&P 500 declined 0.6 percent at 1:38 p.m. New York time. A close at that level would be the lowest since April 11. The U.S. benchmark fell in the last session amid an uninspiring corporate earnings season.
Bank shares fell a second day, while energy and raw-material producers — the two strongest groups as stocks rebounded from a February low — lagged for a third session. Priceline Group Inc. sank 10 percent after its profit forecast disappointed, with executives citing in part the “fragility” of the global economy. Investors stuck with a recent preference for defensive shares, as utilities, consumer staples and phone companies advanced.
Investors are also monitoring U.S. presidential campaigns, with Donald Trump, becoming the presumptive Republican nominee after his final two challengers exited the race.
The Stoxx Europe 600 Index was down 1.1 percent, with all industry groups falling. Anheuser-Busch InBev NV — the world’s largest brewer — slid 1.6 percent after reporting sales and profit growth that missed estimates. BHP Billiton Ltd. tumbled after it was named in a $44 billion law suit over a dam rupture in Brazil that caused deaths and severe environmental damage.
The MSCI Emerging Markets Index of stocks fell 1.2 percent to the lowest in a month. Russia’s Micex Index dropped 1.4 percent as trading resumed following a two-day holiday. The Hang Seng China Enterprises Index fell 0.6 percent, dropping for a third day, and the Shanghai Composite Index slipped less than 0.1 percent.
The Bloomberg Dollar Spot Index added 0.5 percent. The greenback added 0.4 percent to 107.19 yen and was little changed at $1.1491 per euro.
Japanese Finance Minister Taro Aso said Tuesday, when the nation’s currency reached an 18-month high, that the government is monitoring speculative foreign-exchange trades and will respond if needed. The yen has strengthened more than twice as much as any other major currency in the past week as the Bank of Japan unexpectedly refrained from adding to stimulus at a policy review.
The MSCI Emerging Markets Currency Index fell for a third day, sliding 0.8 percent to the lowest since April 8. Russia’s ruble, South Africa’s rand and Malaysia’s ringgit weakened the most versus the dollar out of 24 currencies, losing at least 1.5 percent.
Oil fell, reversing earlier gains, after a government report showed crude inventories rose 2.78 million barrels. Analysts surveyed ahead of the release had anticipated a stock build of 750,000 barrels in the week ended April 29. West Texas Intermediate fell 0.6 percent to $43.37 a barrel, down from $44.55 prior to the release.
Gold slid a third day, as the dollar’s rebound dimmed the metal’s appeal as an alternative investment. Bullion for immediate delivery retreated 1.1 percent to $1,272.65 an ounce. Copper fell 1.1 percent to $4,867 a metric ton and zinc dropped 0.5 percent.
Glencore Plc kept a pledge to produce less metal following last year’s price rout. Zinc output slid 28 percent in the first quarter from a year earlier, copper production was 4 percent lower and the firm mined 17 percent less coal.
The yield on 10-year U.S. Treasuries fell less than one basis point to 1.78 percent, while German government bonds were also little changed, with the 10-year rate at 0.20 percent.
Turkey’s bonds fell before crisis talks between the president and prime minister scheduled for Wednesday that have prompted concerns over a power struggle. The Borsa Istanbul 100 Index of stocks dropped for a fourth day in the longest slump in four months, as the lira slid 1.4 percent versus the dollar. Turkey’s 10-year bond yield was up 10 basis points at 9.33 percent.