Debt concerns weigh on stocks
Technology-company troubles and renewed concerns about Europe's debt dragged stocks lower for a second day Monday. European finance ministers approved $110 billion in rescue loans to Portugal, but they have yet to decide on a second rescue package for Greece.
Technology-company troubles and renewed concerns about Europe's debt dragged stocks lower for a second day Monday.
European finance ministers approved $110 billion in rescue loans to Portugal, but they have yet to decide on a second rescue package for Greece.
The arrest of the head of the International Monetary Fund is expected to make solving Greece's problems more difficult. The official, Dominique Strauss-Kahn, had been heavily involved in trying to fix the debt crises in Portugal and Greece. He is being held without bail on charges of sexually assaulting a hotel employee in New York City.
Technology companies sustained the largest losses in Monday trading. Yahoo Inc. and Amazon.com Inc. fell by more than 4 percent. Yahoo is in a dispute with Alibaba Group Holding Ltd. over its online-payment business. Yahoo owns a 40 percent stake in the company, which transferred its online-payment business to another company without consulting Yahoo.
Investors are growing increasingly concerned over the prospect of an unprecedented U.S. default on its debt. Treasury Secretary Timothy Geithner told lawmakers in a letter Monday that the agency was taking steps to postpone a default.
The Dow Jones industrial average lost 47.38 points, or 0.38 percent, to close at 12,548.37. The Standard & Poor's 500 index fell 8.30 points, or 0.62 percent, to 1,329.47. The Nasdaq fell 46.16, or 1.63 percent, to 2,782.31.
Commodity prices were mostly lower. Oil prices fell $2.28 to settle at $97.37 a barrel Monday as worries eased that Mississippi River flooding could disrupt refineries and slow demand.
Commodities have been falling broadly over the last two weeks because of concerns that the global economy is showing signs of weakening.
The stock market has lost some of its momentum in the last few weeks after finishing its best first quarter since 1998. Companies in so-called defensive industries such as health care, utilities, and consumer staples have outperformed lately due in part to concerns that high gas prices will slow the economy and cut into corporate profits.
Two well-known retailers in the United States fell after reporting quarterly results Monday. The home-improvement company Lowe's Cos. fell 2 percent after its quarterly report missed Wall Street's estimates and the company cut its outlook for the year. Bad weather and a decline in consumer spending combined to drive its profit down 6 percent in the first quarter.
J.C. Penny Co. Inc. lost 1.5 percent despite raising its full-year profit estimates.
One of the most talked-about deals on Wall Street was officially nixed as well. The parent company of the New York Stock Exchange dropped nearly 11 percent after competitors Nasdaq OMX Group and ICE announced that they had withdrawn their hostile bid for the company. NYSE Euronext had angered its shareholders by refusing to meet with the two companies, which offered a higher price than what NYSE received from the German exchange operator Deutsche Boerse AG.