BUSINESS

Stocks end mostly lower as Greece debt deadline approaches

Stocks had a mixed day Friday, as investors waited for negotiators to finish their work on a solution to Greece's debt problems. Chinese stocks plunged 7 percent as fears spread that a yearlong bull rally there has become overheated. China's benchmark index is still up more than double over the past year.

The Dow Jones industrial average added 56.66 points, or 0.3 percent, to 17,947.02. It was largely lifted by Nike, which rose more than 4 percent after posting strong quarterly results.

The Standard & Poor's 500 index fell 0.70 of a point, or 0.03 percent, to 2,101.61 and the Nasdaq composite lost 31.68 points, or 0.6 percent, to 5,080.51. All three indexes ended the week slightly lower.

As they have done all week, global investors are watching closely as Greek debt talks go down to the wire. On Thursday, a key meeting of eurozone finance ministers broke up without an agreement. The 19 ministers are due to meet again Saturday.

Greece needs a deal in order to make a debt payment of 1.6 billion euros ($1.8 billion) to the International Monetary Fund on Tuesday. Failing to do so would put the country on a path toward default and a possible exit from the euro.

“While these deadlines can quite often be taken with a pinch of salt, Greece has literally run out of time on this occasion,” said Craig Erlam, senior market analyst at OANDA.

Investors now turn to next week, when the U.S. government will release the June jobs report. Economists forecast that U.S. employers created 237,500 jobs last month, according to FactSet.

There's been a lot of focus on when the Federal Reserve will raise its key interest rate. Recent economic data seems to show that the U.S. economic recovery is holding steady, and now many investors are expecting the Fed to raise rates in September.

“There's a premium on economic data right now. Outside of Greece, everyone will be focused on how the U.S. economy is holding up,” said Quincy Krosby, a market strategist at Prudential Financial.

While Greece has been the main driver in financial markets recent weeks, worries over China have risen the list of concerns. On Friday, Chinese stocks plunged more than 7 percent. The Shanghai composite closed at 4,391.91. It reached 5,300 just two weeks ago.

“Although I continue to be optimistic about the longer-term trend of (China's) markets, it's clear that we are in a sharp correction phase,” said Bernard Aw of IG Markets in Singapore.

In energy trading, the price of oil was nearly flat Friday. It finished the week little changed, and remained in a narrow range for the ninth straight week. Benchmark U.S. crude fell 7 cents to close at $59.63 a barrel in New York.

Oil finished last week at $59.61 and it has traded roughly between $57 and $61 since late April. Brent crude, a benchmark for international oils used by many U.S. refineries, rose 6 cents to close at $63.26 a barrel in London.

In other futures trading on the New York Mercantile Exchange, wholesale gasoline rose 1.2 cents to close at $2.049 a gallon. Heating oil rose 0.1 cents to close at $1.863 a gallon and natural gas fell 7.7 cents to close at $2.773 per 1,000 cubic feet.

Gold rose $1.40 to $1,173.20 an ounce. Silver fell 7 cents to $15.73 an ounce and copper rose 2 cents to $2.64 a pound.

U.S. government bond prices fell. The yield on the 10-year Treasury note rose to 2.48 percent from 2.39 percent late Thursday.

In currency trading, the euro fell to $1.1161 while the dollar rose to 123.85 Japanese yen.

 

Copyright © 2016, Los Angeles Times
71°