U.S. STOCKS, BONDS

The S&P 500 fell Thursday, extending the longest slump for the broader market in nearly two months as investors weighed concerns about corporate earnings and a global economic slowdown. The Standard & Poor's 500-stock index dropped 6.69 points, or 0.5%, to 1334.76. Technology and financial shares led declines, while defensive sectors such as healthcare and utilities rose.

The Dow Jones Industrial Average fell 31.26 points, or 0.25%, to 12573.27, recovering from a late-morning drop of as much as 112 points.

The Nasdaq Composite shed 21.79 points, or 0.75%, to 2866.19. A bright spot among Dow industrials was Merck, which jumped 4.1% after saying results from a late-stage study of an osteoporosis treatment were positive enough for an early end to the trial.

Procter & Gamble added 3.8% after a report that activist investor Bill Ackman has taken a large stake in the company.

In corporate earnings news, Supervalu plunged 49% after suspending its dividend and withdrawing financial projections for the year to account for pricing pressure.

It reported worse-than-expected quarterly results and said it's considering selling all or part of itself amid a heavy debt load and fierce competition in its industry.

Pessimism around Supervalu's results contributed to a slide in fellow grocery-store operator Safeway, which led the S&P 500 lower falling 12%.

Marriott International dropped 6.4% after warning of weakening expansion overseas. Investors shrugged off a Labor Department report that the number of U.S. workers filing for jobless benefits fell more than economists expected to the lowest level in more than four years last week.

The drop could offer hope that the labor market might be slowly improving. Economists cautioned the reading was likely skewed by government adjustments to compensate for seasonal shutdowns at auto plants.

EUROPEAN STOCKS, BONDS

European stocks fell and the euro dropped to a two-year low against the dollar as investors worried about slowing global growth and hope faded that the Federal Reserve will soon act to bolster the U.S. economy.

The benchmark Stoxx 600 index fell 1.1% to 252.89. Euro-zone industrial production rose in May, but economists continue to think there will be a contraction in the region's economy in the second quarter.

The U.K.'s FTSE 100 declined 1% to 5608.25. Germany's DAX slipped 0.5% to 6419.35 and France's CAC-40 fell 0.7% to 3135.18.

There was widespread disappointment that the minutes of the Federal Reserve's most recent policy-setting meeting didn't contain clear signs that the Fed is committed to taking action, although the minutes did indicate policy makers are seriously considering a move.

In addition, there was nervousness ahead of the release of China's second-quarter gross domestic product data Friday. Cyclical stocks, whose performance is closely tied to the health of the global economy, suffered the brunt of the selling.

Mining house Anglo American declined 2.2% as metals prices dropped. BHP Billiton gave up 3.3% after Credit Suisse downgraded the stock to neutral from outperform.

Among banks, HSBC Holdings dropped 2.3%, Standard Chartered lost 0.8%, and Royal Bank of Scotland Group shed 1.4%. Deutsche Bank fell 2%, while Commerzbank slid 2.6%. News that Italy's borrowing costs fell sharply failed to boost stocks in Milan.

The country sold 7.5 billion euros ($9.193 billion) of 12-month bills at an average yield of 2.697%, down from 3.972% at the previous auction June 13.

Still, the FTSE Mib index fell 2.0% to 13,583.82 and Spain's IBEX 35 dropped 2.6% to 6630.10.

In corporate news, French supermarket operator Carrefour soared 7% after reporting its second-quarter sales. PSA Peugeot-Citroen slid 1.7% after it confirmed plans to stop production at one of its French auto factories and slash 8,000 jobs in the country. Media firm Aegis Group surged 45% after Japan's Dentsu offered to buy the U.K. company.

ASIA-PACIFIC STOCK MARKETS

Asian markets fell Thursday, as a surprise rate cut in South Korea, a lack of central bank policy action from Japan, and weak jobs data from Australia kept investors on edge a day before the release of a likely downbeat report on Chinese growth.

Japan's Nikkei Stock Average ended down 1.5%, South Korea's Kospi tumbled 2.2%, and Hong Kong's Hang Seng Index fell 2%. China's Shanghai Composite Index edged up 0.5%.

The day began on a weak note after a lack of clarity on future easing measures from the Federal Reserve weighed on U.S. stocks Wednesday.

Banks sold off sharply in Hong Kong. Industrial & Commercial Bank of China Ltd. lost 2.4%, and China Merchants Bank Co. retreated 2.3%.

In the property sector, Agile Property Holdings Ltd. sank 2.2%, and New World Development Co. finished down 2%.

Luxury plays were also heavy decliners. Prada SpA gave up 4.6%, and Chow Tai Fook Jewellery Group Ltd. slumped 8.8%.

Losses for many blue-chip exporters accelerated in Tokyo during the session, with the BOJ decision giving the yen a lift against the U.S. dollar.

Renesas Electronics Corp. plunged 8.9%, while Sharp Corp. sank 7% and Panasonic Corp. gave up 4.5%.

Heavy falls for shipping-related firms worked to drag the South Korean index lower. Samsung Engineering Co. lost 3.1% and Hyundai Heavy Industries Co. pulled back 1.8%.

Resource shares retreated across Asia following a mostly weak overnight session for commodity markets. Hong Kong-listed Aluminum Corp. of China Ltd. sank 3.5%.

COMMODITIES

Base metals closed mostly lower on the London Metal Exchange Thursday, weighed by a stronger dollar and nervousness over global growth.

At the close, LME three-month aluminum was down 1.0% at $1,882 a metric ton. Flagship copper was up 0.2% at $7,555/ton, the only metal in the complex to close in positive territory.

Crude-oil prices spent most of Thursday lower but turned higher late in the day on news the U.S. government was imposing more sanctions on Iran, stoking supply fears.

Light, sweet crude for August delivery settled at $86.08 a barrel on the New York Mercantile Exchange, up 27 cents. Brent crude on the ICE futures exchange was up 60 cents at $100.83.

The Treasury Department said in an afternoon statement it is imposing harsher sanctions on Iran and targeting front companies being used to evade the international sanctions.

The statement went on to name tanker and shipping companies, as well as banks, it said were helping Tehran circumvent the sanctions.

Gold fell to a two-week low under the weight of a slumping euro and as investors saw few hints of the type of central bank easing that would push investors into precious metals. The most actively traded contract, for August delivery, fell $10.40, or 0.7%, to settle at $1,565.30 a troy ounce on the Comex division of the New York Mercantile Exchange, the lowest ending price since June 28. Compiled from MORRISON SECURITIES PTY. LTD.