YAHOO [BRIEFING.COM]: A wave of widespread weakness sank the stock market more than 1% to its lowest level in two months, but a steady climb in afternoon trade helped stocks slash losses.

Amid a lack of meaningful earnings announcements and a complete absence of domestic data, most market participants opted to sell stocks at the open due to lingering concerns about the implications of recent political elections in Europe -- Europe's major bourses settled their latest session with steep losses, dropping the EuroStoxx by 1.5%.

Domestic averages attempted to stabilize after enduring an opening leg down, but selling regained traction to take the S&P 500 below the 1350 line for the first time snce early March. A failed rebound attempt left stocks to drift lower again, but their ability to stay off of session lows suggested was enough support to prevent further losses. From there stocks began a steady ascent that saw the Dow recover more than 100 points.

Energy stocks staged one of the more impressive swings. The sector was down more than 2% at its session low, but settled the day down only 0.4%. Meanwhile, crude oil recovered from a session low of $95.57 per barrel to settle pit trade at $97.13 per barrel for a 0.8% loss. Despite the upturn, the closing price stands as the lowest closing level for the June contract this year. Natural gas prices also recoverd from negative territory to close pit trade at $2.39 per MMBtu for a 2.6% gain.

Defensive in nature, Utilities and Health Care scored gains of 0.2%, but neither was down dramatically at any point during the day. Telecom suffered a 0.2% loss after it had spent most of the session outperforming the other major sectors.

The turn in tone took the Volatility Index from above 20, which hasn't been eclipsed for almost a month, back to about 19 by the closing bell. The resulting increase for the VIX was less than 1%, although it had been up nearly 10% earlier in the day.

Volatility seemed to excite some traders. Share volume on the NYSE didn't break the 1 billion mark, but it did hit 900 million, which is above averages for the past few months.

The dollar advanced another 0.3% against a basket of major foreign currencies today. That puts it comfortably above its 50-day moving average, which was first crossed late last week, at a new three-week high.

Treasuries also attracted a solid bid, or at least enough to send the yield on the 10-year Note even closer to 1.80% for a new a three-month low before it eased off that mark. Results from an auction of 3-year Notes today resulted in a bid-to-cover ratio of 3.65, dollar demand of $116.8 billion, and an indirect bidder participation rate of 35.7%. For comparison, the prior auction drew a bid-to-cover of 3.36, dollar demand of $107.5 billion, and an indirect bidder rate of 39.9%, while an average of the last six auctions results in a bid-to-cover of 3.48, dollar demand of $111.3 billion, and an indirect bidder rate of 36.4%.

The CRB Commodity Index suffered a 0.8% loss, which marks its fourth down day in five sessions. The span of weakness comes after it had scored six consecutive gains.

Crude oil continued its downtrend, falling as low as $95.57 per barrel before reversing. The energy component more than halved its loss so that it settled pit trade 0.8% lower at $97.13 per barrel -- the June contract's lowest closing level of 2012. Natural gas prices were in negative territory for most of the session, but a rally into the close shot prices into positive territory. Futures contracts closed with prices at $2.39 per MMBtu, which makes for a 2.6% gain.

Precious metals were under stiff selling pressure all session. Gold dropped as low as $1596.30 per ounce to set its lowest level since the start of the year. The June contract settled with a 2.1% loss at $1604.90 per ounce, a closing low for 2012. Silver also suffered a 2.1% loss by settling its floor session at $29.43 per ounce.

Advancing Sectors: Health Care +0.2%, Utilities +0.2%
Declining Sectors: Consumer Staples -0.1%, Telecom -0.2%, Industrials -0.3%, Energy -0.4%, Materials -0.5%, Tech -0.5%, Financials -0.7%, Consumer Discretionary -1.3%DJ30 -76.44 NASDAQ -11.49 NQ100 -0.4% R2K -0.1% SP400 -0.2% SP500 -5.86 NASDAQ Adv/Vol/Dec 1205/2.17 bln/1313 NYSE Adv/Vol/Dec 1188/900 mln/1800