Setbacks with creditors in Greece upset U.S., European markets
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NEW YORK – A setback in talks between Greece and its creditors helped knock the stock market lower Friday, amid renewed concerns the country could default on its debts.
Despite the drop, the Standard & Poor’s 500 index managed to eke out a 1-point gain for the week, snapping a two-week slump.
An unexpected decision by the International Monetary Fund to walk away from talks with Greece spurred the selling. At a summit meeting in Brussels late Thursday, the IMF pulled its negotiators out of talks with Greece, saying there was no progress and major differences remained on key issues. Without a deal by the end of the month, Greece faces the prospect of going bankrupt and dropping the euro currency.
Markets are likely to make sudden turns until Greece and its creditors reach a deal, said Ninh Chung, head of investment strategy at SVB Asset Management. Earlier this week, stocks on both sides of the Atlantic rallied on reports of progress in the talks.
“There had been optimism over Greece,” Chung said, “and now it seems like we’ve had a complete 180.”
The S&P 500 slipped 14.75 points, or 0.7 percent, to close at 2,094.11. The Dow Jones industrial average fell 140.53 points, or 0.8 percent, to 17,898.84, and the Nasdaq composite lost 31.41 points, or 0.6 percent, to 5,051.10.
The losses were modest but broad: All 30 companies in the Dow and all 10 industries in the S&P 500 finished with losses.
Major indexes in Europe slumped, wiping out gains from earlier in the week. Greece’s market fell the most, with the main Athens index down 6 percent. Germany’s DAX sank 1.2 percent, and the CAC-40 in France finished with a loss of 1.4 percent. Britain’s FTSE 100 lost 1 percent.
In Asia, Japan’s Nikkei 225 inched up 0.1 percent. In China, the Shanghai composite index advanced 0.9 percent, and Hong Kong’s Hang Seng rose 1.4 percent.
Back in the United States, shares of Wingstop vaulted 61 percent in their first day of trading as a public company. The chicken-wings chain raised $110.2 million in its initial public offering late Thursday, selling shares to investors at $19 each. Wingstop soared $11.59 to $30.59.
Government bond prices wavered, finishing the day slightly lower. The yield on the 10 -year Treasury inched up to 2.39 percent from 2.38 percent the day before.
In metals trading, gold fell $1.20 to settle at $1,179.20 an ounce, while silver slipped 14 cents to $15.83 an ounce. Copper picked up a penny to $2.68 a pound.
Oil fell for a second straight day after reaching a high for the year on Wednesday. Benchmark crude oil sank 81 cents to settle at $59.96 a barrel. Brent crude, an international benchmark, dropped $1.24 to $63.87 a barrel.