Greek 'day of reckoning' shakes stock markets

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European Stocks Tumble as Greece Crisis Roils Markets

NEW YORK (AP) -- U.S. stocks are broadly lower in afternoon trading Friday following steep declines in Europe. Investors are worried that Greece may default on its debt and exit the eurozone. Shares of several big U.S. companies, including American Express, dropped after disappointing results.

KEEPING SCORE: The Dow Jones industrial average slumped 242 points, or 1.3 percent, to 17,863 as of 1:25 p.m. Eastern time. The Standard & Poor's 500 lost 21 points, or 1 percent, to 2,084. The Nasdaq fell 70 points, or 1.4 percent, to 4,937. All 10 industry groups in the Standard and Poor's 500 fell.

GREEK WORRY: Greece and its creditors are still struggling to find a deal that can keep the country from defaulting on its debt. The argument is over what reforms Greece should make in return for loans. Many think Greece will struggle to make payments to the International Monetary Fund due next month if it fails to reach a deal.

The concerns have caused investors to demand higher rates for loaning money to Greece's government. The yield on the country's benchmark 10-year bond jumped to 12.72 percent Friday. That rate has more than doubled from 5.51 percent in September.

THE QUOTE: "The day of reckoning" for Greece is fast approaching, said Uri Landesman, president of investment fund Platinum Partners. "People thought everyone would work it out, but if no one caves, there won't be a deal," he said.

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Greek 'day of reckoning' shakes stock markets
BRUSSELS, BELGIUM - FEBRUARY 20: Commissioner for Economic and Financial Affairs, Taxation and Customs Pierre Moscovici (L) and German Finance Minister Wolfgang Schaeuble (R) are seen during an emergency meeting of Eurozone finance ministers to discuss the Greece bailout program at the European Council in Brussels on February 20, 2015. (Photo by Dursun Aydemir/Anadolu Agency/Getty Images)
BRUSSELS, BELGIUM - FEBRUARY 20: Greek Finance Minister Yanis Varoufakis is seen during an emergency meeting of Eurozone finance ministers to discuss the Greece bailout program at the European Council in Brussels on February 20, 2015. (Photo by Dursun Aydemir/Anadolu Agency/Getty Images)
BRUSSELS, BELGIUM - FEBRUARY 20: Greek Finance Minister Yanis Varoufakis (R) and Spanish Finance Minister Luis De Guindos Jurado (L) are seen during an emergency meeting of Eurozone finance ministers to discuss the Greece bailout program at the European Council in Brussels on February 20, 2015. (Photo by Dursun Aydemir/Anadolu Agency/Getty Images)
BRUSSELS, BELGIUM - FEBRUARY 20: President of the European Central Bank, Mario Draghi (L 2), Spanish Finance Minister Luis De Guindos Jurado (R 2), Italian Finance Minister Pier Carlo Padoan (L) and French Finance Minister Michel Sapin (R) are seen during an emergency meeting of Eurozone finance ministers to discuss the Greece bailout program at the European Council in Brussels on February 20, 2015. (Photo by Dursun Aydemir/Anadolu Agency/Getty Images)
BRUSSELS, BELGIUM - FEBRUARY 20: Dutch Finance Minister and president of Eurozone Jeroen Dijsselbloem (R) and President of the European Central Bank, Mario Draghi are seen during an emergency meeting of Eurozone finance ministers to discuss the Greece bailout program at the European Council in Brussels on February 20, 2015. (Photo by Dursun Aydemir/Anadolu Agency/Getty Images)
BRUSSELS, BELGIUM - FEBRUARY 20: Greek Finance Minister Yanis Varoufakis (R), Spanish Finance Minister Luis De Guindos Jurado (L) and French Finance Minister Michel Sapin (C) are seen during an emergency meeting of Eurozone finance ministers to discuss the Greece bailout program at the European Council in Brussels on February 20, 2015. (Photo by Dursun Aydemir/Anadolu Agency/Getty Images)
BRUSSELS, BELGIUM - FEBRUARY 20: Greek Finance Minister Yanis Varoufakis (R) and French Finance Minister Michel Sapin are seen during an emergency meeting of Eurozone finance ministers to discuss the Greece bailout program at the European Council in Brussels on February 20, 2015. (Photo by Dursun Aydemir/Anadolu Agency/Getty Images)
Greek Finance Minister Yanis Varoufakis attends an emergency Eurogroup finance ministers meeting at the European Council in Brussels on February 20, 2015. Eurogroup head Jeroen Dijsselbloem was working overtime on February 20 to save a make-or-break meeting on Greece's demand to ease its bailout programme as Germany insisted it stick with its austerity commitments. After days of sharp exchanges, the 19 eurozone finance ministers gathered for the third time in little over a week to consider Athens' take-it or leave-it proposal to extend an EU loan programme which expires this month. AFP PHOTO / EMMANUEL DUNAND (Photo credit should read EMMANUEL DUNAND/AFP/Getty Images)
Greek Finance Minister Yanis Varoufakis attends an emergency Eurogroup finance ministers meeting at the European Council in Brussels on February 20, 2015. Eurogroup head Jeroen Dijsselbloem was working overtime on February 20 to save a make-or-break meeting on Greece's demand to ease its bailout programme as Germany insisted it stick with its austerity commitments. After days of sharp exchanges, the 19 eurozone finance ministers gathered for the third time in little over a week to consider Athens' take-it or leave-it proposal to extend an EU loan programme which expires this month. AFP PHOTO / EMMANUEL DUNAND (Photo credit should read EMMANUEL DUNAND/AFP/Getty Images)
BRUSSELS, BELGIUM - FEBRUARY 20: Dutch Finance Minister and president of Eurozone Jeroen Dijsselbloem speaks to media ahead of an emergency meeting of Eurozone finance ministers to discuss the Greece bailout program at the European Council in Brussels on February 20, 2015. (Photo by Dursun Aydemir/Anadolu Agency/Getty Images)
Greek national flags fly above Greek-themed hats on a street vendor's stall at Syntagma square in Athens, Greece, on Friday, Feb. 20, 2015. Germany and its allies turned up the pressure on Greece to accept their conditions to stay in the euro as the region's top finance officials descend on Brussels to hammer out a deal. Photographer: Kostas Tsironis/Bloomberg via Getty Images
The Greek, left, and EU flag flap in the wind outside the Greek embassy in Brussels on Friday, Feb. 20, 2015. Eurozone finance ministers meet for a crucial day of talks to see whether a Greek debt relief proposal is acceptable to Germany and other nations using the common currency. (AP Photo/Virginia Mayo)
The Greek, left, and EU flag flap in the wind outside the Greek embassy in Brussels on Friday, Feb. 20, 2015. Eurozone finance ministers meet for a crucial day of talks to see whether a Greek debt relief proposal is acceptable to Germany and other nations using the common currency. (AP Photo/Virginia Mayo)
The Greek, left, and EU flag flap in the wind outside the Greek embassy in Brussels on Friday, Feb. 20, 2015. Eurozone finance ministers meet for a crucial day of talks to see whether a Greek debt relief proposal is acceptable to Germany and other nations using the common currency. (AP Photo/Virginia Mayo)
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EUROPE SLUMPS: Germany's DAX slumped 2.6 percent. France's CAC 40 shed 1.6 percent and Britain's FTSE 100 fell 0.9 percent. Investors piled into German government debt, which is perceived as being among the safest investments denominated in euros. The yield on the 10-year German government bond fell to 0.08 percent from 0.09 percent. Yields fall when bond prices rise.

CHINA SHORTS: After markets closed in Asia, Chinese financial regulators issued warnings about that country's soaring stock market. Regulators said they will tighten rules on borrowing to buy stocks. They also plan to make it easier for investors to bet against the market there, The Wall Street Journal reported. Shanghai's stock market has surged 33 percent so far this year and is up 6 percent this week alone.

"People are thinking maybe the party is over in China," said Doug Cote, chief market strategist for Voya Investment Management. He added, "China recognizes that it could be creating a bubble, and now it wants to slow down. It's trying to rein back risk."

AMEX TROUBLE: American Express fell $3.20, or 4 percent, to $77.71 after its quarterly results took a blow from the sharp rise in the U.S. dollar. Amex's profits increased 6 percent, but revenue fell. The stronger dollar made the company's overseas earnings worth less after being converted back into U.S. currency.

ANOTHER REVENUE MISS: Honeywell International fell $1.67, or 1.3 percent, to $102.65 after reporting disappointing first-quarter results. The industrial conglomerate posted earnings per share that beat estimates, but its revenue fell short.

CHIP DIP: Advanced Micro Devices plunged nearly 14 percent after reporting a larger loss than investors had expected. After the market close on Thursday, the chipmakers said that losses, adjusted for restructuring costs and stock option expense, came to 9 cents per share versus an expected loss of 6 cents per share. The stock fell 42 cents to $2.46.

FUN AND GAMES: Mattel's stock jumped $1.71, or nearly 7 percent, to $26.98. After the market closed Thursday, the toymaker reported a smaller quarterly loss than analysts had expected. Mattel's revenue also trumped estimates, helped by strong sales of Hot Wheels.

BLOOMBERG DOWN: Bloomberg LP's trading terminals, which are used by most of the world's biggest financial firms, went down for a few hours on Friday due to apparent technical problems, prompting the British government to postpone a planned 3 billion-pound ($4.4 billion) debt issue.

ASIA'S DAY: The Shanghai Composite index rose 2.2 percent after data showed that China's economy grew at the slowest pace since 2009 during the first quarter. The data stoked expectations that the country would introduce further stimulus measures to achieve its annual growth target. The market closed before news about the tighter borrowing rules came out.

South Korea's Kospi rose 0.2 percent. Hong Kong's Hang Seng shed 0.3 percent. Japan's Nikkei 225 fell 1.2 percent, while Australia's S&P ASX 200 was down 1.2 percent.

ENERGY: U.S. benchmark crude oil slipped 71 cents to $56 a barrel in New York. The contract rose 40 cents to settle at $64.01 on Thursday, its highest price this year.

CURRENCIES, BONDS: The dollar fell slightly to 118.86 yen while the euro rose to $1.0794. Bond prices fell after the U.S. government reported a slight increase in inflation last month. The yield on the 10-year Treasury note fell slightly to 1.87 percent from 1.88 percent on Thursday.

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