North American indexes slid into the close on Friday, ending a volatile week with another loss as investors continue to fret over the debt crisis in Europe.
The Dow Jones industrial average closed at 10,136.63, down 122.36 points, or 1.2 per cent – leaving it down 4.5 per cent for the week. The broader S&P 500 closed at 1089.41, down 13.65 points, or 1.2 per cent. The index fell 8.3 per cent in May, its worst monthly performance since February, 2009 (when it fell 11 per cent).
In Canada, the S&P/TSX composite index closed at 11,671.44, down 77.68 points, or 0.7 per cent – or down just 1.3 per cent for the week.
Stocks had begun the day with a thud after a report showed that U.S. consumer spending was unchanged in April, after impressive gains during the previous two months.
But perhaps the biggest source of anxiety was Fitch Ratings’ credit downgrade on Spain, by one notch. The downgrade took away Spain’s triple-A rating based on concerns about the country’s high debt levels, but the move was hardly out of the blue: Standard & Poor’s had made a similar move last month.
Nonetheless, it put Europe’s debt crisis back in focus, following an upbeat day for stock markets on Thursday when it appeared that the concerns had largely been forgotten. Among the Dow’s 30 members, 27 ended the day lower in a widespread selloff. Bank of America Corp. fell 2.7 per cent, Cisco Systems Inc. fell 2.2 per cent and Alcoa Inc. fell 1.5 per cent.
In Canada, Royal Bank of Canada fell 2.6 per cent and Canadian Imperial Bank of Commerce fell 0.9 per cent, a day after the two banks reported earnings that failed to meet expectations.
Energy stocks were mixed after the price of crude oil dipped below $74 (U.S.) a barrel. Suncor Energy Inc. fell 0.9 per cent but Canadian Natural Resources Ltd. rose 0.4 per cent.
