A roundup of trading on major world markets:
NEW YORK – US stocks closed sharply lower after an early rise Wednesday as worries persisted over whether the eurozone would come up with an effective approach to containing the Greek crisis.
The Dow Jones Industrial Average closed down 179.79 points (1.61 per cent) to 11,010.90.
The broader S&P 500 gave up 24.32 points (2.07 per cent) to 1,151.06, while the Nasdaq Composite lost 55.25 points (2.17 per cent) to 2,491.58.
The tumble came after three days of gains that had largely ignored signs of discord in Europe over how to move ahead on the regional crisis as well as a series of poor US economic data.
Germany’s parliament on Thursday will weigh the July 21 rescue package agreed by European Union leaders which includes a new Greek bailout and an expansion of the eurozone rescue fund.
All 30 Dow blue chips fell, with Bank of America taking a 4.9 per cent hit after a New York Times report said it is facing a $US50 billion ($A50.67 billion) shareholder lawsuit related to its takeover of Merrill Lynch.
The bond market rose slightly. The 10-year Treasury bond yield was at 2.00 per cent compared to 2.00 per cent late Tuesday, while the 30-year yield fell to 3.09 per cent from 3.12 per cent.
Bond prices and yields move in opposite directions.
LONDON – European stocks fell amid doubts eurozone leaders are any closer to resolving the debt crisis before EU-IMF auditors were due to arrive in Athens.
After see-sawing during the session on Wednesday, European stocks closed down with London’s FTSE-100 index dropping 1.44 per cent to 5,217.63 points.
In Paris the CAC-40 fell 0.92 per cent to 2,995.62 points and in Frankfurt the DAX slid 0.89 per cent to 5,578.42 points. Madrid dipped 0.61 per cent and Milan 0.47 per cent.
The euro rose to $1.3632 from $1.3590 in New York late Tuesday. The dollar fell to 76.53 yen from 76.84 yen.
The Financial Times said Greece’s second bailout had run into trouble, with some eurozone members pushing for private creditors to take a bigger writedown on their Greek bond holdings.
In an interview with Greece’s state television, German Chancellor Angela Merkel appeared to confirm this, saying the audit could also determine if the second bailout set up in July will stand as originally agreed.
The head of the German banking federation criticised the rampant talk eurozone governments may now push private holders of Greek government bonds to accept losses of 50 per cent instead of 21 per cent as agreed in July.
In Greece, the government hoped for a last-minute EU-IMF rescue amid fresh protests against austerity measures after Athens pledged a “superhuman” effort to stabilise its debt-stricken economy.
A mission from the EU, the International Monetary Fund and the European Central Bank was expected in Athens on Thursday to resume an audit vital to the release of rescue funds from the first bailout loan to Greece.
Athens has warned it will run out of money next month unless it receives the rescue funds.
A key contributor to the rescue, Germany, was meanwhile scheduled to vote on Thursday on expanding the scope and size of the EU’s rescue fund, the European Financial Stability Facility (EFSF).
HONG KONG – Asian markets were mixed in edgy trade.
Early gains were pared as caution set in due to a lack of concrete evidence of a plan to save Greece from default, while dealers also looked ahead to a key vote Thursday in Germany, where MPs will decide on expanding a rescue fund for debt-mired European countries.
Tokyo ended flat, edging up 5.70 points to 8,615.65 and Sydney was 0.87 per cent, or 34.9 points, higher at 4,039.5.
Seoul ended 0.73 per cent, or 12.62 points, lower at 1,723.09, a day after surging more than five per cent, while Shanghai was 0.74 per cent off in the afternoon.
And Hong Kong slipped 0.19 per cent as profit-takers stepped in after the market soared 4.15 per cent in the previous session.
There seemed no clear sign of a solution to the crisis, which has sent global markets spiralling downwards and raised fears of another crippling financial crisis.
Singapore dipped 0.91 per cent, or 24.74 points, to 2,701.17.
Jardine Cycle and Carriage was up 1.90 per cent to 40.17 while Keppel Corp slumped 2.89 per cent to 8.07.
WELLINGTON – Wellington edged up 0.16 per cent, or 5.34 points, to 3,298.17.
Air New Zealand added 0.9 per cent to NZ$1.09 but Telecom fell 1.9 per cent to NZ$2.53 and Fletcher Building was down 0.3 per cent at NZ$7.55.
