*
Major U.S. stock indexes lower
*
Oil prices near flat after Monday’s rally
*
Dollar index declines
NEW YORK, April 4 (Reuters) – World stock indexes
declined on Tuesday, with Wall Street well into negative
territory in afternoon trading, while the U.S. dollar fell to a
two-month low and Treasury yields eased after data suggesting a
cooling in the U.S. labor market.
The U.S. Labor Department report showed U.S. job openings in
February dropped to the lowest level in nearly two years.
In addition, a separate report showed new orders for
U.S.-manufactured goods fell for a second straight month in
February amid ebbing demand for civilian aircraft.
The S&P 500 was pressured the most by the economically
sensitive industrial sector, which was last down 2.2%.
Materials were also lower.
The yield on two-year Treasuries, which typically
moves in step with interest rate expectations, fell to 3.838%.
Crude oil prices were near flat after Monday’s sharp rally
tied to Sunday’s announcement of an output target cut by the
Organization of the Petroleum Exporting Countries (OPEC) and its
partners.
Brent crude rose 1 cent to settle at $84.94 a
barrel, while U.S. crude gained 29 cents to settle at
$80.71.
The recent spike in oil prices has added to concerns about
higher costs for businesses and consumers, but some investors
think U.S. data signaling some cooling in the economy could
possibly allow the Federal Reserve to loosen monetary policy.
The Dow Jones Industrial Average fell 238.53 points,
or 0.71%, to 33,362.62, the S&P 500 lost 28.15 points, or
0.68%, to 4,096.36 and the Nasdaq Composite dropped
78.02 points, or 0.64%, to 12,111.43.
The pan-European STOXX 600 index lost 0.08% and
MSCI’s gauge of stocks across the globe shed
0.32%.
Shares of Glencore, whose bid for Teck Resources
was rebuffed by the Canadian copper miner the day
before, rose 1.7%.
The Fed and other central banks have been raising interest
rates to bring down inflation, and investors have been trying to
gauge how much longer the tightening cycle will continue.
“Cooling down of the labor market is one of the things
necessary to combat inflation,” said Andrzej Skiba, head of the
BlueBay U.S. fixed income team at RBC Global Asset Management in
New York.
On Tuesday, rate futures markets were pricing in a roughly
even chance of a 25 basis-point rate hike in May, with rest of
the odds tilted toward a pause from the Fed. On Monday, the
probability of a 25-bp hike was more than 65%.
The U.S. dollar index was last down 0.4% after
falling to its lowest level in about two months, while the euro
was up 0.5% at $1.09520.
“We believe the buck will slowly but surely continue to
dwindle as the challenges of a recovering economy that wants to
get away from dollar dominance will put downward pressure on its
value,” said Juan Perez, director of trading at Monex USA in
Washington.
The Australian dollar came under pressure after the
Reserve Bank of Australia left interest rates unchanged after 10
straight increases. It was last down 0.7% against the U.S.
dollar at $0.6737.
Spot gold added 1.8% to $2,020.53 an ounce.
(Reporting by Caroline Valetkevitch in New York
Additional reporting by Amanda Cooper in London and Herbert Lash
and Gertrude Chavez-Dreyfuss in New York
Editing by Jonathan Oatis and Matthew Lewis)
