US stocks plummet on disappointing jobs report, Hungary's debt woes

Jun 4, 2010, 23:07 GMT

Washington - Major US stock indices plunged more than 3 per cent Friday on a poor unemployment report and fresh European debt worries, this time over Hungary.

The Dow Jones Industrial Average posted its third-largest point loss this year, closing below the symbolic 10,000-point mark after the Labour Department said the private sector added just 41,000 jobs in May.

The US labour market added 441,000 jobs in total in May and the jobless rate fell from 9.9 per cent to 9.7 per cent, but the bulk of these were temporary government hires for the 2010 Census, a population count conducted once every 10 years.

In Europe, a Hungarian government spokesman said it was 'no exaggeration' to compare his country's dangerous fiscal situation to that of Greece, which has been beset by protests and plunged the eurozone into crisis as it battles to bring a spiralling budget deficit under control.

The news pushed the euro to a new four-year low against the dollar. The US currency rose to 83.51 euro cents from 82.24 euro cents on Thursday.

The blue-chip Dow plummeted 323.31 points, or 3.15 per cent, to 9,931.97. The broader Standard and Poor's 500 Index tumbled 37.95 points, or 3.44 per cent, to 1,064.88. The technology-heavy Nasdaq Composite Index plunged 83.86 points, or 3.64 per cent, to 2,219.17.

The day's losses pushed the three stock indices sharply lower for the week. The Dow lost 3.19 per cent in the last five days. The S&P 500 dropped 3.46 per cent and the Nasdaq was down 2.57 per cent.

Japan's announcement of a new prime minister early Friday pushed the dollar lower against the Japanese yen, after days of gains on the resignation of the outgoing Yukio Hatoyama's. The US currency fell to 91.84 yen from 92.67 yen on Thursday.