World stocks slip as Greek debt talks falter

AP News
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Posted: Jun 15, 2015 9:38 AM
World stocks slip as Greek debt talks falter

NEW YORK (AP) — U.S. stocks are opening lower after weekend talks between Greece and its creditors stalled, raising the possibility the country could default.

The Dow Jones industrial average lost 188 points, or 1 percent, to 17,713 as of 9:35 a.m. Eastern time Monday.

The Standard & Poor's 500 fell 18 points, or 0.9 percent, to 2,075. The Nasdaq composite lost 46 points, or 0.9 percent, to 5,004.

United Technologies fell 2 percent after the company said it would get out of the helicopter business.

Nervous investors bought ultra-safe U.S. government bonds, pulling the yield on the 10-year Treasury note down to 2.32 percent from 2.39 percent late Friday.

European markets fell. Benchmark indexes were down 2 percent in Germany and France. Investors sold Greek stocks and Greek government bonds.

THIS IS A BREAKING NEWS UPDATE. Check back soon for further information. AP's earlier story is below.

World stocks sank Monday as Greece inched closer to default after weekend talks with international creditors over freeing up the rest of its bailout funds went nowhere. Chinese shares led declines in Asia after regulators tightened up on lending by brokerages to investors.

KEEPING SCORE: European stocks traded lower, with France's CAC 40 shedding 1.6 percent to 4,824.63. Germany's DAX dropped 1.8 percent to 10,994.49 and Britain's FTSE 100 lost 1 percent to 6,718.62. U.S. stocks were poised to open lower. Dow and S&P 500 futures were down 0.5 percent.

GREEK DRAMA: Weekend negotiations on Greece's bailout terms produced no breakthroughs and Greek officials and creditors remained far apart as a deadline for a debt payment nears. Greek leaders want to get access to the final 7.2 billion euros ($8.2 billion) of their bailout program that's needed to repay debts and avoid a possible default that could trigger an exit from the euro; the bailout package expires at the end of the month. But investors are growing nervous at signs of scant progress in talks with creditors, including eurozone states, the European Central Bank and the International Monetary Fund. Greece's stock market was down 5 percent.

THE QUOTE: "We have always argued that a Greek deal would only occur at one minute to midnight," Michael Every, Rabobank's head of Asia-Pacific financial market research, wrote in a commentary. "Yet it now looks like 23:58 and counting."

CURRENCIES: The euro stabilized after initially slumping 0.5 percent on news of the Greek debt impasse. By the time European markets opened, it was 0.3 percent lower at $1.1237 from $1.1260 in late trading Friday. The dollar was stable around 123.39 yen.

CHINA CREDIT: Moves by regulators to tighten up on margin financing sent Chinese shares lower. The country's securities regulator issued draft rules Friday limiting the amount investors can borrow from brokerages for trading to four times their net capital, according to a report by the official Xinhua news agency. Authorities are clamping down as they try to prevent a crash in China's overheated stock markets, which have soared in the past year in a boom fueled partly by borrowed money.

ASIA'S DAY: Japan's benchmark Nikkei 225 index ended 0.1 percent lower at 20,387.79 and South Korea's Kospi shed 0.5 percent to close at 2,042.32. Hong Kong's Hang Seng slumped 1.5 percent to 26,861.81 and the Shanghai Composite Index in mainland China dropped 2 percent to 5,062.99. Australia's S&P/ASX 200 edged 0.1 percent lower to 5,538.80. Benchmarks in Southeast Asia also fell.

ENERGY: Benchmark U.S. crude oil extended losses, falling 82 cents to $59.14 a barrel in electronic trading on the New York Mercantile Exchange. The contract hit a high for the year on Wednesday but has been falling since then and on Friday it sank 81 cents to settle at $59.96 a barrel.