A rout in crude oil prices hammers the stock market

NEW YORK - A slump in oil prices sparked a global sell-off in financial markets Friday, with losses spreading from Asia to Europe to the United States, where stocks fell sharply to cap their worst week since the summer.

The selling was broad, with all 10 sectors of the Standard and Poor's 500 index ending down. The Dow Jones industrial average lost 309.54 points, or 1.8 percent, to close at 17,265.21. The Nasdaq composite fell 111.71 points, or 2.2 percent, to 4,933.47. The S&P 500 dipped 39.86 points, or 1.9 percent, to 2,012.37.

Fearful investors put their money in government bonds, especially Treasuries. The yield on the 10-year Treasury note fell to 2.12 percent from 2.23 percent late Thursday, a big move. The dollar fell to 120.79 yen from 121.64. The euro strengthened to $1.0995 from $1.0939.

In Europe, Germany's DAX lost 2.4 percent, Britain's FTSE 100 dropped 2.2 percent, and France's CAC 40 shed 1.8 percent. In Asia, Japan's Nikkei 225 index climbed 1 percent, but most other major indexes fell. Hong Kong's Hang Seng dropped 1.1 percent, and mainland China's Shanghai Composite lost 0.6 percent.

Investors worry that the sharp fall in the price of oil and other commodities is a sign of weakness in the global economy, especially in China, and that it will cut into profits at big energy producers and suppliers of raw materials, as well as other companies.

"We're stockpiling commodities and demand is not picking up," said Tim Courtney, chief investment officer of Exencial Wealth Advisors. "It's kind of a depressing market."

Energy shares, already decimated this year, fell 3.4 percent Friday. Southwestern Energy plunged 14 percent. Freeport McMoRan, a mining giant, dropped 6 percent.

The trouble began with a report from the International Energy Agency that the oversupply in oil would persist until late next year as demand continues to weaken.

Benchmark U.S. crude plunged $1.14, or 3 percent, to close at $35.62 a barrel in New York. The price has been falling for 1 1/2 years and is at its lowest level since early 2009.

Brent crude, the international oil benchmark, fell $1.80, or 4.5 percent, to $37.93 a barrel in London.

Investors also were rattled by trouble in a risky corner of the credit markets where bonds from heavily indebted companies are traded. Their prices have fallen sharply as investors fear the companies that issued the bonds might default. A fund that tracks the bonds, iShares iBoxx USD High Yield Corporate Bond ETF, has dropped nearly 4 percent in five days.

Investors are also focused on a Federal Reserve meeting next week, at which the central bank is widely expected to announce an increase in its benchmark interest rate from a record low.

"It's anticipation of the Fed, it's oil, it's credit. . . . All of these factors are putting fear and confusion into the investor," said Jonathan D. Corpina, senior managing partner at Meridian Equity Partners.

Among stocks making big moves Friday, software maker Adobe Systems rose $2.46, or 2.8 percent, to $91.42 after reporting earnings in its latest quarter that exceeded analysts' expectations. The stock is up 26 percent since the start of the year.

Corning rose 99 cents, or 5.6 percent, to $18.68, after the company said it will give up its stake in Dow Corning, a joint venture with Dow Chemical, which on Friday officially announced a merger with DuPont. Instead, Corning will invest in a semiconductor business owned by Dow Corning.

In other fuels trading, heating oil plunged eight cents, or 6.5 percent, to $1.146 a gallon; wholesale gasoline was little changed at $1.282 a gallon; and natural gas lost 2.5 cents, or 1.2 percent, to $1.99 per 1,000 cubic feet.

In metals trading, gold edged up $3.70 to $1,075.70 an ounce, silver fell 23 cents to $13.88 an ounce, and copper rose four cents to $2.12 a pound.