US open: Dow Jones Industrials drops almost 90 points as volatility persists

US stocks opened lower Thursday, in the wake of a sell-off in European stocks fuelled by uncertainty in the bond market.

Just after 15:00 BST, the Dow Jones Industrial Average was down 88 points, while the S&P 500 and the Nasdaq fell 10 and 19 points, respectively.

Jobless claims edge lower

The number of Americans claiming unemployment benefits in the week to the end of May remained close to a 15-year low.

US initial jobless claims fell to 282,000 in the week to 30 May from 284,000 the previous week, slightly higher than the 278,000 claims analysts had forecast.

Meanwhile, US labour productivity in the first three months of the year fell at a downwardly revised annual pace of 3.1%, figures released on Thursday by the Bureau of Labor Statistics showed.

Government statisticians initially estimated that US workers' productivity declined by 1.9% in the first quarter and the revision was slightly higher than the 3% drop analysts had expected.

Euro selloff continues

“The overriding factor [behind the selloff] is the European bond-market volatility, which started yesterday afternoon, and we’ve seen this volatility transpire into the equity market in Europe this morning and in U.S. futures as well,” said Craig Erlam, senior market analyst at Oanda.

On Wednesday, the yield on 10-year German bunds reached its highest level in 2015 after European Central Bank president Mario Draghi said investors should get used to periods of increased volatility.

"To turn bond yields around back into the territory of negative yields many were getting used to, president Draghi would have had to introduce a more radical step such as the ECB increasing or at least implying it could increase bond purchases if needed," said CMC Markets' analyst Jasper Lawler.

The dollar reversed earlier losses and was broadly stable against both euro and yen, although it 0.15% against the pound, while gold futures fell 0.68% to $1,176.80

In company news, satellite-TV provider Dish Network jumped 4.01% in pre-market trading after reports suggested it was in talks to merge with T-Mobile US, which saw its shares rose 5.66%.

Clinical testing laboratory Bio-Reference Labs surged 39.62% after agreeing to a $1.5bn takeover bid from Opko Health, which saw its shares decline 4.24%.

Elsewhere, Asian markets ended mixed after a session in which they struggled for direction, while oil prices fell ahead of a highly anticipated meeting of OPEC energy ministers on Friday.

West Texas Intermediate fell 1.7% to $58.62 a barrel, while Brent climbed 1.4% to $62.89 a barrel.