Stocks slide on Korea worries over Korea

Associated Press

NEW YORK

Stocks sank during Friday’s shortened session as jittery traders were afraid to commit to any holdings ahead of the weekend amid lingering uncertainty surrounding Europe’s debt troubles and North Korea’s war threats.

European stock markets and the euro fell as worries mounted that Portugal will be the next country to need cash from other European Union countries, even as details of Ireland’s bailout were being worked out.

On Friday, Portugal adopted a raft of debt-reducing austerity measures, which the government claimed would be enough to restore market confidence in its public finances without resorting to a bailout.

However, that didn’t soothe traders who are also nervously eyeing North Korea’s threat of war, which could destabilize its neighboring Asian nations. North Korea warned Friday that plans by South Korea and the U.S. to stage military maneuvers have put the Korean peninsula on the brink of war. North Korea fired artillery shells at a South Korean island on Tuesday, killing four people.

The Dow Jones industrial average fell 95.28, or 0.9 percent, to 11,092. The S&P 500 index was down 8.95, or 0.8 percent, to 1,189.40. The Nasdaq composite index fell 8.56, or 0.3 percent, to 2,534.56.

“Until there’s final resolution of both Spain and Portugal investors will continue to be fearful,” said John O’Donoghue, co-head of equities at Cowen & Co.

Consolidated volume on the New York Stock Exchange was 1.5 billion, which was just about a third of the usual volume.

Friday also marks the unofficial start of the holiday shopping season. Black Friday, a crucial event for retailers, was off to a strong start, according to early reports.