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- Subjects of interest in 1992 killing take polygraph tests; results not revealed (1/18/17)2
- Governor cuts $146 million, colleges take hit (1/17/17)
Dow closes below 10,000 for first time in 3 months
NEW YORK -- The Dow Jones industrial average closed below 10,000 for the first time in three months Monday on nagging concerns about debt loads in Europe.
The Dow, down almost 104 points, had its 10th triple-digit move in 16 trading days. Shares of big banks pulled the market lower, extending a slump that has led to four straight weekly losses.
Mounting deficits in weaker European economies including Greece, Portugal and Spain have raised questions about the health of the global financial system. That compounded concerns about growth in China and proposed U.S. bank regulations took the market down from a 15-month high reached in January.
Greece's finance minister said Monday the government is preparing to boost some taxes to shore up its finances. But civil servants opposed to cutbacks have pledged to strike Wednesday.
Brett Hryb, a portfolio manager with MFC Global Investment Management in Toronto, said the latest concern is that the financial troubles in a country like Greece, whose economy is small compared with the rest of Europe, will spill into other countries.
"Clearly Greece itself is nothing. It's just a blip. It's what the contagion could be," he said.
Monday's drop extends the stumble the market began in mid-January. At that time, China announced plans to contain economic growth and the Obama administration proposed rules to restrict trading by large financial institutions.
The Dow fell 103.84, or 1 percent, to 9,908.39. On Thursday, the Dow traded below the psychological barrier of 10,000 for the first time since November. It hadn't closed below that mark since Nov. 4. The Dow is still up 51.3 percent since March.
The broader Standard & Poor's 500 index fell 9.45, or 0.9 percent, to 1,056.74, while the Nasdaq composite index fell 15.07, or 0.7 percent, to 2,126.05.
Bond prices edged higher, pushing yields lower. The yield on the benchmark 10-year Treasury note was flat at 3.57 percent from late Friday.
The dollar fell against other major currencies, while gold rose.
Crude oil rose 70 cents to settle at $71.89 per barrel on the New York Mercantile Exchange.
Questions about the global economy have interrupted a 10-month climb in stocks, which hit 12-year lows last March. The Dow is down 817 points, or 7.6 percent, from its recent high of 10,725.43 on Jan. 19.
Jerry Webman, chief economist at OppenheimerFunds Inc., said he doesn't expect that problems with rising debt loads in Europe will cascade into other parts of the world's economy, but he remains cautious.
"Right now, when anybody says the word 'contained' I start to tremble," he said, referring to his skepticism about those who downplay worries about Greece and other countries with rising deficits.
Webman is also concerned by the shrugs that have greeted corporate earnings reports. Three out of four of the companies in the S&P 500 index that have reported results for the fourth quarter have posted stronger sales and profit numbers than analysts forecast, according to Thomson Reuters.
"The market is obviously not that enthusiastic about these good bottom-line and good top-line numbers," Webman said, adding that he sees that as a reason to be concerned about the direction of stocks.
In earnings news, the toymaker Hasbro Inc. said its profit surged 77 percent in the fourth quarter while drugstore chain CVS Caremark Corp. said its earnings rose 11 percent. The results beat analysts' estimates.
Hasbro jumped $3.91, or 12.7 percent, to $34.71, while CVS rose $1.65, or 5.3 percent, to $32.72.
Three stocks fell for every two that rose on the New York Stock Exchange, where volume came to 1.1 billion shares compared with 1.6 billion Friday.
The Russell 2000 index of smaller companies fell 6.49, or 1.1 percent, to 586.49.
Britain's FTSE 100 rose 0.6 percent, Germany's DAX index gained 0.9 percent, and France's CAC-40 rose 1.2 percent. Earlier, Japan's Nikkei stock average fell 1.1 percent.