Global stocks fall 5th day, Brent off 2 percent on euro zone fears
By Caroline Valetkevitch
NEW YORK (Reuters) - World stocks fell for a fifth day and Brent oil prices dropped 2 percent on Thursday on concerns about the health of Spain's banks and the prospect of Greece leaving the euro zone.
Adding to pressure on Wall Street stocks was a U.S. government report showing manufacturing in the mid-Atlantic states unexpectedly contracted in May. The Standard & Poor's 500 .SPX index finished at a four-month low.
The data helped lift safe-haven U.S. Treasuries prices and pushed the 10-year note yield to its lowest in more than seven months, while the yen climbed against the euro and dollar.
Worries about Spanish banks resurfaced after a media report said customers of Bankia BKIA.MC had withdrawn more than 1 billion euros from their accounts in the past week. The Spanish government said there had been no such exit of deposits.
The developments in Spain followed reports that customers of Greek banks were moving funds on the belief the country would exit the euro, adding to broader anxiety about the region's debt crisis.
After the U.S. market close, Moody's Investors Service cut the long-term and deposit ratings of 16 Spanish banks, including Banco Santander (SAN.MC: Quote).
"The whole equities market is being driven by a macro trade based upon contagion fear in Europe, and really the problem is undercapitalized banks there," said Jack de Gan, chief investment officer at Harbor Advisory Corp in Portsmouth, New Hampshire.
Global shares, as measured by MSCI's world equity index .MIWD00000PUS, dropped 1 percent and posted in a fifth day of losses, along with U.S. stocks. Continued...