Stock market tumbles on economic concerns

Associated Press

NEW YORK

Just when Wall Street seemed to have settled down, a barrage of bad economic reports collided with fresh worries about European banks Thursday and triggered a global sell-off in stocks.

The Dow Jones industrial average fell 419 points — a return to the wild swings that gripped the stock market last week.

Stocks were only part of a dramatic day across the financial markets. The price of oil fell $5, gold set another record, the 10-year Treasury hit its lowest yield, and the average mortgage rate fell to its lowest in at least 40 years.

The selling began in Asia, where Japanese exports fell for a fifth-straight month, and continued in Europe, where bank stocks were hammered because of worries about debt problems there, which have proved hard to contain.

On Wall Street, the losses wiped out much of the roughly 700 points that the Dow had gained over five days. Some investors who bought in the middle of last week decided to sell after they were confronted with a raft of bad news about the economy:

More people joined the unemployment line last week than at any time in the past month. The number of people filing claims for unemployment benefits for the first time rose to 408,000, or 9,000 more than the week before.

Inflation at the consumer level in July was the highest since March.

Sales of previously occupied homes fell in July for the third time in four months — more trouble for a housing market that can’t seem to turn itself around.

Manufacturing has sharply weakened in the mid-Atlantic states, according to a report from the Federal Reserve.