Stocks turn higher amid strong U.S. data, trade concerns

Stocks turn higher amid strong U.S. data, trade concerns

Additionally, Euro Zone inflation jumped far more than expected in May on higher energy costs, data showed on Thursday, bringing some relief to the European Central Bank after market turbulence that has jeopardized its planned exit from its crisis-era stimulus program.

WALL STREET: Prices for US government bonds surged as investors shifted money from stocks into lower-risk investments. "Should Italy leave the eurozone, it's clearly bad for European assets and it's bad for the European banking system".

The euro struggled near a six-and-a-half-month low, and the pound hit a six-month low against a rallying dollar amid signs of panic in European bond markets.

New jitters about the stability of the euro sent the currency's value against the dollar to its lowest level in nearly a year. The sharp move higher reflects weakening confidence among investors in Italy's government.

Italian President Sergio Mattarella picked Carlo Cottarelli for prime minister after the anti-establishment 5-Star Movement and right-wing League refused to withdraw an anti-euro candidate as economy minister. Germany's DAX lost 1.1 percent.

"Italy is now facing elections in the midst of political chaos", Soros said at a speech in Paris, warning that failed economic and immigration policies mean that "it is no longer a figure of speech to say that Europe is in existential danger; it is the harsh reality".

UniCredit SpA Chief Executive Officer Jean Pierre Mustier said the decline in Italian bank stocks was driven by fears rather than reality based on the performance of the Italian economy or the lenders themselves. That country's parliament will hold a vote of no confidence in Prime Minister Mariano Rajoy after graft convictions of businesspeople and officials tied to his conservative Popular Party.

EARLY LAGGARDS: Among health care companies, Johnson & Johnson fell 1.2 percent to $120 and Thermo Fisher Scientific lost 1.4 percent to $201.75. JPMorgan Chase dropped 4.3 percent to $105.93 and Bank of America fell 4 percent to $28.96.

Oil struggled under pressure from expectations that Saudi Arabia and Russian Federation would pump more oil to counter potential supply shortfalls from Venezuela and Iran, even as USA output has surged in recent years. The Nasdaq fell 66 points, or 0.9 percent, to 7,367. Brent crude, used to price worldwide oils, dropped 40 cents to $77.16 per barrel.

Wholesale gasoline gave up 1.7 percent to $2.14 a gallon. South Korea's Kospi dropped 2.0 percent to 2,407.95.

Gold fell 0.4 percent to $1,299 an ounce. Copper gave up 0.5 percent to $3.06 a pound.

ASIAN SCORECARD: Japan's Nikkei 225 index fell 0.1 percent to 22,171.35 and the Shanghai Composite index tumbled 0.7 percent to 3,075.14.

Tuesday's sell-off was the third consecutive session of lower closes for the Dow and the S&P 500, both of which suffered their worst day on a percentage basis since April 24. Hong Kong's Hang Seng index clawed back losses to gain 0.1 percent, ending at 30,492.91.

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