U.S. stocks ended a dreadful month on down note on Thursday, with major indexes suffering worst loss in about two years, amid gloomy U.S. economic data and endless European debt woes.

As of Thursday's close, the Dow Jones industrial average lost 26.41 points, or 0.21 percent, to 12,393.45. The blue-chip index suffered its first monthly losses since October, tumbling 6.2 percent in May, with only five gains in 22 trading sessions and not a single two-day winning streak.

The Standard & Poor's 500 dropped 2.99 points, or 0.23 percent, to 1,310.33, down 6.3 percent for the month.

The Nasdaq Composite Index retreated 10.02 points, or 0.35 percent, to 2,827.34, down more than 7 percent for the month, its biggest monthly drop in two years.

Concerns over European debt crisis have been the biggest drag for the market in the past month. Worsening economic and political situations in Greece, Spain and the euro zone put squeeze on the Wall Street, driving investors out of equities to safe-haven assets such as the U.S. bonds.

Yields of the U.S. benchmark 10-year note dropped to a record low at the end of the month, highlighting the fears among investors.

News from Europe continued to move the market on the last day of May. The European Central Bank and European Commission warned that if no stronger measures or tough fiscal discipline were implemented, the single currency area could face the risk of disintegration.

However, stocks pared earlier losses in late session, with the Dow and S&P 500 returning to positive territory, as rumor had it that the International Monetary Fund has started discussing contingency plans for a rescue loan to Spain in the event that the country fails to find the funds needed to bail out Bankia SA, its third-largest bank by assets.

The gains, unfortunately, didn't hold to the last minute as both Spanish government and the IMF denied any discussion of future bailout plans between the two parties.

Apart from the debt woes across the Atlantic, economic data from the United States also signaled a slowdown, adding pressure to the already fragile sentiment.

According to the Labor Department, the number of people applying for unemployment benefits rose 10,000 to a seasonally adjusted 383,000, while economists were expecting the reading to be around 370,000, a level signaling mild improvement in jobs sector.

Meanwhile, private-sector jobs increased only 133,000 from April to May, much fewer than the previous estimate of 150,000, according to a report by payroll processing company ADP.

What's more, the U.S. Commerce Department revised the gross domestic product for the first quarter to 1.9 percent from 2.2 percent. The downward revision suggested that the U.S. economic recovery was not as optimistic as investors had anticipated. In Other markets, the U.S. dollar rose about 5 percent in the past month and traded at a two-year high against the euro.

Oil prices, however, tumbled more than 17 percent in May.

VietNamNet/Xinhuanet