It was a bloody Thursday on Wall Street. All three major indices were lower by around 3% for the session. The Dow, after a drop of 358 points, became the first major index to take out the January and March lows. To be precise, it closed at the lowest level since September 2006. This June turned out to be a disaster month for stocks. The Dow was down by 9.4% so far in the month, making it the worst June since 1930. Even taking other months into consideration, it marked the worst monthly performance since September 2002. Things are not looking promising overseas either. For example, stocks in Europe were down 10% so far in the month. A new record in crude price, deepening concerns over the financial sector and several disappointing earnings reports were cited as the reasons behind today’s drop.

We had some mixed news on the economic front this morning. The advance figure for seasonally adjusted initial claims came at 384K, unchanged from the previous week’s revised figure. Economists were looking for a number close to 375K. The continuing claims jumped 82K in the latest week to 3.139 million, the highest level since February 2004. In a separate report, sales of existing homes increased 2% to a 4.99 million annual rate compared to 4.95 million expected. The median price of existing homes dropped 6.3% from a year ago to $208,600. On the supply front, the number of unsold homes on the market fell 1.4% to 4.49 million from 4.55 million in April. However, that still represented 10.8 months’ supply. Both the price drop and the number of months’ supply were comparable to yesterday’s new home sales data, which came at 10.9 months and -5.7% respectively. Lastly, the Q1 GDP was being further revised up to 1.0% from an initial estimation of 0.6%. The final reading in Q1 GDP matched with economists’ forecast.

All 10 major sectors ended the session lower by at least 1%. Other than a few selective names such as gold mining, there was simply no place to hide. But it was totally a different story when it came to commodities. The CRB commodity index jumped 2.5% today to 463.27, a new high. Energies, agricultures and precious metals all moved up. Only industrial metals were mixed as strengths in copper and nickel were offset by other metals. The US dollar was mixed against major currencies. Treasuries rallied across the board as a typical flight to quality bid went on. The VIX index, which is usually used as a fear indicator, jumped more than 13% today. However, even after today’s jump, the VIX was still lower than where it was closed back on June 11th while the Dow was down more than 600 points during the same period. The market breath was decisively on the negative side.