US hit by fears that worst is not over

US stocks tumbled yesterday, halting a four-day winning streak, as falling oil prices hit energy shares, while less upbeat economic reports rekindled worries about recovery prospects.<br /><br />Oil prices slipped more than 3 per cent after a surprise build-up in inventories. Shares of energy companies, including <strong>Chevron</strong> off 1.6 per cent, were top drags, along with other natural resource companies and big manufacturers such as <strong>Boeing</strong>, down almost 2 per cent.<br /><br />Investors took a one-two punch from data showing the vast service sector contracted for the eight straight month in May and from a report showing employers axed 532,000 private-sector jobs last month.<br /><br />The data, which fell short of consensus expectations, signalled the revival in consumer and business spending, crucial for profit growth, will take longer than previously thought.<br /><br />The Dow Jones industrial average dropped 65.63 points, or 0.75 per cent, to 8,675.24. The Standard &amp; Poor&rsquo;s 500 Index shed 12.98 points, or 1.37 per cent, to 931.76. The Nasdaq Composite Index declined 10.88 points, or 0.59 per cent, to 1,825.92.<br /><br />Since the stock market&rsquo;s run-up from the 12-year low of early March investors have been eager to get more definitive signs that the recession is abating, but yesterday&rsquo;s economic reports tempered some of the recent optimism.<br /><br />Federal Reserve Chairman Ben Bernanke said in an appearance before the House Budget Committee he expected to see &ldquo;some positive growth later this year&rdquo; but not robust growth.<br /><br /><strong>Chevron</strong> shares fell 1.6 per cent to $68.26, while <strong>Exxon Mobil</strong> shares declined 1.2 per cent to $72.08. The <strong>S&amp;P</strong> energy index fell 3.3 per cent.<br /><br />US front-month crude <strong>CLc1</strong> settled down $2.43, or 3.5 per cent, to $66.12 a barrel after government data showed a surprise build-up in inventories in the recent week.<br /><br />Commodities companies were also hit as the dollar strengthened more than 1 per cent against a basket of currencies, depressing the value of commodities denominated in the US currency