NEW YORK (Reuters) - Stocks hit a four-month low on Thursday as rising Spanish bond yields increased investor anxiety over that country's banks and another round of weak data undermined hopes for U.S. economic recovery.
Growing worries over developments in the euro zone and lackluster economic data pushed the S&P's losing streak to five consecutive days. The index, which closed at a level not seen since mid-January, has now relinquished more than half of its gains from the first quarter.
"There is not a lot of interest in the equity market," said Jason Weisberg, managing director at Seaport Securities Corp in New York. "The overhang with Europe is so heavy, people are tired of playing whack-a-mole, and their portfolios are the mole."
The Dow Jones industrial average (DJI:^DJI - News) dropped 156.06 points, or 1.24 percent, to 12,442.49. The Standard & Poor's 500 Index (MXP:^GSPC - News) fell 19.94 points, or 1.51 percent, to 1,304.86. The Nasdaq Composite Index(NAS:^COMP) lost 60.35 points, or 2.10 percent, to 2,813.69.
A gauge of future U.S. economic activity fell in April for the first time in seven months, and the Philadelphia Federal Reserve's index of business conditions hit its lowest since September.
In addition, the weekly claims for jobless benefits showed no improvement, a sign the pace of hiring remains lackluster.
With a pattern of brief gains during recent trading sessions fizzling quickly, bulls saw little reason to fight the selling pressure.
"Everyone is inclined to sell into rallies rather than buy into dips, find any excuse to sell," said Terry Morris, senior equity manager for National Penn Investors Trust Company in Reading, Pennsylvania.
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