Commodities plunged the most since 2009, led by oil and silver, and stocks posted the biggest three-day drop since March as selling of energy futures drove down equities. The dollar strengthened and Treasurys jumped.
The Standard & Poor’s GSCI index of 24 commodities sank 6.5 percent at 4:01 p.m. in New York and lost 9.9 percent this week. Oil tumbled 8.6 percent, the most in two years, to $99.80 a barrel.
Silver dropped 8 percent, extending the biggest four-day slump since 1983 to 25 percent. The MSCI All-Country World Index of shares in 45 nations fell 1.3 percent.
The dollar rose 2.1 percent versus the euro, making commodities quoted in the greenback more expensive for holders of other currencies.
Selling swept commodities markets as investors sold positions following gains of more than 23 percent in 2011 through April 29 by silver, oil, gasoline, coffee and cotton. The dollar, which slumped 13 percent versus the euro between Jan. 7 and May 2 as the S&P 500 Index rallied 7.2 percent, strengthened against all 16 major counterparts except the yen after European Central Bank President Jean-Claude Trichet signaled he will wait until after June to raise interest rates.
“It’s panic,” said Michael Shaoul, chairman of Marketfield Asset Management, which oversees $1 billion in New York. “You have those super crowded trades. Now you’re in liquidation mode. There’s nothing to do with weak U.S. economic data. It’s not a global financial crisis. It’s a classic liquidation move in a crowded trade.”
The U.S. said claims for employment benefits jumped to 474,000 last week amid auto-plant shutdowns, exceeding the median economist estimate of 410,000 in a Bloomberg survey, while worker productivity declined. The data raised concern about the world’s biggest economy a day before the Labor Department may say nonfarm payrolls increased 185,000 in April after gaining 216,000 the previous month, according to the median forecast of 84 economists surveyed by Bloomberg.
© Copyright 2017 Bloomberg News. All rights reserved.