Market Wrap: Stocks Inch Down on Greece, China Worries

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Dow Drops Over 200 Points In Intraday Trading
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By Caroline Valetkevitch

NEW YORK -- U.S. stocks slipped Thursday as mixed messages about Greece's debt talks kept investor uncertainty high along with a sharp drop in Chinese shares after brokers tightened margin rules.

Seven of the 10 major S&P 500 sectors were lower, with the industrials sector falling the most, 0.4 percent, a day after the Nasdaq closed at a record high.

International Monetary Fund Managing Director Christine Lagarde said there was still a lot of work to do before Greece and its international lenders could clinch a cash-for-reforms deal.

Greece's government said it aims to reach an agreement with lenders by Sunday. A euro zone official said Greece won't be able to get the money still available under its current bailout plan if it doesn't agree to the outline of a such a deal by the end of the week.

"Everybody is coming out with a different story. I'm looking for an EU-endorsed comment rather than something coming from Greece to be sort of the final arbiter on what the sentiment really is with regard to a resolution," said Mark Luschini, chief investment strategist at Janney Montgomery Scott in Philadelphia, which manages about $67 billion in assets.

Shares of Caterpillar (CAT) fell 2.2 percent to $86.01 and helped to drag down the S&P 500 and Dow, while shares of transportation companies extended recent losses. The Dow Jones transportaion average was down 0.9 percent.

The Dow Jones industrial average (^DJI) fell 36.87 points, or 0.2 percent, to 18,126.12, the Standard & Poor's 500 index (^GSPC) lost 2.69 points, or 0.1 percent, to 2,120.79 and the Nasdaq composite (^IXIC) dropped 8.62 points, or 0.2 percent, to 5,097.98.

In China, indexes plummeted 6 percent after more brokerages tightened margin trading requirements in a move seen aimed at curbing risks in a red-hot market.

Investors also were cautious ahead of Friday's reading on U.S. gross domestic product.

Movers and Shakers

Among gainers, action camera-maker GoPro (GPRO) rose 6.6 percent to $56.81 after GoPro and Google introduced a virtual reality system using 16 cameras and Google software. Google (GOOG) shares were near flat at $554.18.

Declining issues outnumbered advancing ones on the NYSE by 1,756 to 1,282, for a 1.37-to-1 ratio on the downside; on the Nasdaq, 1,468 issues fell and 1,277 advanced for a 1.15-to-1 ratio favoring decliners.

The S&P 500 posted 16 new 52-week highs and seven new lows; the Nasdaq composite recorded 85 new highs and 45 new lows.

About 5.7 billion shares changed hands on U.S. exchanges, below the 6.2 billion daily average for the month to date, according to BATS Global Markets.

What to watch Friday:
  • The Commerce Department releases first-quarter gross domestic product at 8:30 a.m. Eastern time.
  • The University of Michigan releases consumer sentiment for May at 10 a.m.
Earnings Calendar
These selected companies are scheduled to report quarterly financial results:
  • Bank of Nova Scotia (BNS)
  • Big Lots (BIG)
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