US Stocks Follow Global Equities Down After Grim American Jobs Report

By Mike Obel | June 01 2012 11:50 AM

U.S. stocks followed global equities down Friday as fears mount that the American economy may not be able to offset the combined drag of the euro zone crisis and sharply decelerating growth in China and India.

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The May nonfarm payroll report showed a shockingly weak 69,000 new jobs created, less than half of what most economists expected and a signal the nascent U.S. recovery may be running out of steam. Also, the Chicago purchasing managers index dropped to 52.7 last month from 56.2; economists were expecting an increase to 56.8.

In midday trading, the Dow Jones Industrial Average dropped 213.20, or 1.72 percent, to 12,180.25. The broader S&P 500 fell 25.28, or 1.93 percent, to 1,285.05 and the Nasdaq Composite plunged 60.54, or 2.14 percent to 2,766.80. The yield on the benchmark 10-year Treasury fell to 1.46 percent. Asian stock indexes all closed lower and European indexes tumbled hard, with Germany's DAX plunging 3.35 percent.