US stocks slump on Libya worries

NEW YORK: U.S. stock markets fell on the open Tuesday, as traders gave their initial reaction to mounting unrest in Libya.

After the markets were closed for three days, the answer to violence in oil-producing countries of North Africa was fast.

"Domino effect that the radical Arab world affects the world's financial markets," said Kimberly DuBord.

"The risk of assets being sold," she said, pointing to moves to U.S. Treasuries, the dollar and gold.

"Libya holds Africa in the largest oil reserves and is the eighth largest producer of OPEC production disruptions in Libya would have a significant impact on Europe -.. its largest export market for oil"

Airline companies - whose profits are very sensitive to fuel price increases - were among the main losers.

Shares in the United Continental fell 6.4 percent, Delta Air Lines fell 6.2 percent and American Airlines dropped 5.4 percent. Dow Jones Industrial Average fell 60.85 points (0.49 percent) to 12,332.75.

broad-based S & P 500 fell 9.89 points (0.74 percent) to 1,333.12, and the Tech-heavy Nasdaq was from 34.58 (1.22 percent) 2,799.37.

bond market rose. The yield on the 10-year Treasury fell to 3.53 percent from 3.59 percent on Friday evening, while that on the 30-year Treasury fell to 4.66 percent from 4.70 percent. Bond yields and prices move in opposite directions. (AFP)