US stocks head lower as Greece debt talks resume
Jul 7, 2015, 9:13 AM
In this July 6, 2015 photo, an American flag is draped on the exterior of the New York Stock Exchange. Chinese stocks fell Tuesday, July 7, despite government intervention and other global markets were mixed as Greece's spiraling crisis kept investors on edge. (AP Photo/Mark Lennihan)
(AP Photo/Mark Lennihan)
NEW YORK (AP) — U.S. stocks headed to losses Tuesday as European leaders met to discuss Greece’s strained finances. A plunge in commodity prices helped pull stocks in material producers down more than the rest of the market. Freeport-McMoRan dropped 7 percent, the biggest loss in the S&P 500.
KEEPING SCORE: As of 12:01 p.m. Eastern time, the Standard & Poor’s 500 index was down 13 points, or 0.6 percent, to 2,057. The Dow Jones industrial average dropped 127 points, or 0.7 percent, to 17,556, while the Nasdaq composite fell 60 points, or 1.2 percent, to 4,931.
GREECE: Greece and its creditors are holding talks in Brussels on Tuesday to discuss how to keep the country from falling out of the euro. Analysts say Greece has little time left before its banks run out of cash. The European Central Bank has refused to increase the emergency credit the banks need to cope with withdrawals.
RESPONSE: “It’s all Greece all the time,” said Burt White, chief investment officer at LPL Financial. White thinks that once quarterly earnings reports start to roll in over the coming weeks, investors will turn their focus to the U.S. and its improving economy. That shift could help pull the stock market out of its rut.
ATTENTION-GRABBING: Horizon Pharma offered roughly $2 billion to buy Depomed, a rival pharmaceutical company, in a hostile bid. The Dublin-based company took the offer directly to shareholders after Depomed’s executives reportedly refused to talk about a previous proposal. Horizon fell $1.61, or 5 percent, to $32.93, while Depomed soared $6.91, or 33 percent, to $27.55.
EUROPE: Major indexes in Europe were broadly lower. Germany’s DAX slid 2 percent and France’s CAC-40 lost 2.3 percent. Britain’s FTSE 100 dropped 1.6 percent.
ASIA’S DAY: Markets in China extended a recent slump. The Shanghai Composite Index fell 1.3 percent, while Hong Kong’s Hang Seng lost 1 percent. Tokyo’s Nikkei 225 advanced 1.3 percent, and Seoul’s Kospi lost 0.7 percent.
CHINA’S PLUNGE: China’s major market indexes have lost nearly 30 percent after hitting a peak June 2. The government has responded with a slew of new emergency measures, but analysts argue that they can’t keep prices up without some improvement in economic growth.
ANALYST’S TAKE: “China’s leadership has doubled down on its efforts to prop up equity prices,” said Mark Williams of Capital Economics in a report. “There is a good chance that the market rescue efforts are seen to be a failure in a few months’ time.”
CRUDE: Benchmark U.S. crude fell 39 cents to $52.18 a barrel on the New York Mercantile Exchange. On Monday, the contract plummeted 8 percent amid concerns that the crisis in Greece would trigger a slowdown in Europe.
BONDS AND CURRENCIES: U.S. government bond prices rose, pushing the yield on the 10-year Treasury note down to 2.21 percent from 2.29 percent late Monday. The dollar fell to 122.14 yen from 122.64 yen, while the euro declined to $1.0955 from $1.1056.
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