NEW YORK (AP) - Investors dumped stocks and sought safe-haven assets like the dollar and Treasurys on signs that the global economy is still struggling.
Major stock indexes fell about a percent, including the Dow Jones industrial average, which lost 100 points.
A disappointing earnings forecast from Dow Jones industrials component 3M Co. and a weak sales report from McDonald's Corp., another Dow company, pulled stocks lower. The reports overshadowed an increased profit forecast from FedEx Corp.
Reports in Britain and Germany signaled that manufacturing remains weak, while Japan's government approved $81 billion in stimulus measures to keep its economy out of recession. Meanwhile, a leading credit rating agency has cut its ratings on six Dubai state-linked companies due to worries about their growing debts.
Investors sent the dollar and Treasury prices higher in response to the day's news. Commodities fell as the dollar rose. A stronger dollar makes commodities more expensive for buyers overseas, and hurts profits at companies that have large international operations.
After the massive rally in stocks and commodities this year, investors are looking for clues about where the economy is headed and how best to position their portfolios for next year. Investors are uncertain of how long the environment of low interest rates and a weak dollar that helped fuel the market's rally will last.
Philip S. Dow, managing director of equity strategy at RBC Wealth Management in Minneapolis, said 3M's forecast drew attention from FedEx and that the day's retreat is in order after the steep gains in stocks over all.
"People were so enthused with FedEx then got a little disappointed with 3M," he said. "I just think it's a rest."
At the same time, there are still plenty of doubts about the economic recovery to drive cautious investors to pad their portfolios with safe havens. With the Standard & Poor's 500 index up 63.1 percent since early March, many investors are looking to protect their gains.