U.S. stocks followed European markets lower as weak euro-zone economic data and increasing political uncertainty in France and Holland unnerved investors.The Dow Jones Industrial Average slid 120 points, or 0.9%, to 12909.Standard & Poor’s 500-stock index shed 13 points, or 1%, to 1363 as all 10 of the index’s sectors declined. The Nasdaq Composite dropped 30 points, or 1%, to 2970.European markets were sharply lower. The Stoxx Europe 600 slumped 2.1%, as data showed that the euro-zone’s private sector contracted the most in five months in April, and given increased political uncertainty in France and the Netherlands.The preliminary purchasing managers’ index for the euro zone fell to 47.4 in April from 49.1 in March.

French opposition candidate Francois Hollande advanced to the second round of the country’s presidential election and captured a larger share of first-round votes than incumbent Nicolas Sarkozy, who also progressed. Until now, France has conformed to the German austerity recipe for tackling the region’s economic crisis, but Hollande has urged France’s neighbors to spend more to achieve growth.

France’s CAC-40 index slid 2.4%.

Separately, Dutch budget talks fell apart, raising questions about whether the company will keep its AAA credit rating. Prime Minister Mark Rutte will offer the resignation of his cabinet Monday, local media reported. The widely expected step would pave the way for early elections.”The collapse of austerity talks in Holland is a bad signal. After all, it is one of the few countries that was in the camp of fiscal discipline supporting Germany in its quest for monetary purity,” said Jean Malo, founding partner at Houston Global Investors.

Asian markets also fell. China’s Shanghai Composite was down 0.8% after data showed that manufacturing activity in the country continued to contract in April, although at a slower rate than in March. Japan’s Nikkei Stock Average lost 0.2%.

Crude-oil futures slipped 1.5% to $102.30 a barrel, while gold futures eased 0.7% to $1630.50 an ounce. The U.S. dollar rose against the euro but lost ground against the yen.

In corporate news, shares of  Wal-Mart slumped 3.8% after the blue- chip discount retailer said it was investigating its Mexico operations because a U.S. law that prohibits bribery in foreign countries may have been violated.

Kellogg declined 4.1% after the cereal and snacks maker lowered its full-year earnings and sales outlook. The company’s first-quarter results, which it is due to report Thursday, were “weaker-than-expected.”

Ardea Biosciences soared 51%. The company agreed to be acquired by the U.K.’s AstraZeneca for $1.26 billion. AstraZeneca’s U.S.-listed shares fell

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