U.S. stocks drop amid worries over Spain

08:25, May 25, 2010      

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U.S. stocks tumbled after a choppy session on Monday as fresh concerns about Spain offset an upbeat housing data.

Major indexes traded mixed most of the day but fell sharply in the last 20 minutes of trading on Monday.

What weighed on the market was the worries of a deepening Europe debt crisis. The Bank of Spain said on Saturday it had taken over the running of CajaSur following the failure of its planned merger with another regional lender, underlining the weakness of the banking sectors of some euro zone members.

The euro pulled back from a short-covering rally. The 16-nation currency hit a fresh four-year low last week.

Surge in April existing home sales failed to boost stocks. According to the National Association of Realtors, existing home sales jumped 7.6 percent last month to a seasonally adjusted annual rate of 5.77 million units, higher than analysts had expected.

Energy stocks were under pressure, dragged by BP, whose share fell to a 52-week low as the company is facing mounting criticism for the handling of its Gulf of Mexico oil spill.

The Dow Jones industrial average tumbled 126.82, or 1.24 percent, to 10,066.57. The Standard & Poor's 500 index plunged 14. 04, or 1.29 percent, to 1,073.65 and the Nasdaq lost 15.49, or 0. 69 percent, to 2,213.55.



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