Stocks fall as European debt concerns remain

article

By:

Stephen Bernard and Tim Paradis, Associated Press Writers

NEW YORK (AP) - Stocks fell moderately in morning trading Monday as investors remain wary about the strength of the economic recovery and mounting debt concerns in Europe.

The market's major indexes have traded erratically lately as investors try to determine whether a global economic recovery is sustainable. Traders are still grappling with concerns that some European countries, such as Greece, Portugal and Spain, might not be able to handle their mounting debt. Stocks have also been hurt by China's plans to limit economic growth and the Obama administration's proposed rules to restrict trading by large financial institutions.

All of those concerns have investors on edge about whether the global economy can recover strongly in the coming months. Stocks had rallied for 10 months on hopes of a rebound after hitting 12-year lows last March.

Investors are looking for fresh evidence of economic growth. The recent troubles demonstrate a recovery might not be happening as fast as some had hoped.

In midmorning trading, the Dow Jones industrial average fell 43.68, or 0.4 percent, to 9,968.55. The Standard & Poor's 500 index dropped 3.46, or 0.3 percent, to 1,062.73, while the Nasdaq composite index fell 5.18, or 0.2 percent, to 2,135.94.

In earnings news, the toymaker Hasbro Inc. said its profit surged 77 percent in the fourth quarter while CVS Caremark Corp. said its earnings rose 11 percent. The results beat analysts' estimates.

Hasbro jumped $3.65, or 11.9 percent, to $34.45, while CVS rose $1.65, or 5.3 percent, to $32.72.

Bond prices fell Monday. The yield on the benchmark 10-year Treasury note, which moves opposite its price, rose to 3.58 percent from 3.57 percent late Friday.

The dollar was mixed against other major currencies, while gold rose.

Crude oil fell 1 cent to $71.18 per barrel on the New York Mercantile Exchange.

Two stocks fell for every one that rose on the New York Stock Exchange, where volume came to 128.7 million shares compared with 190.9 million shares traded at the same point Friday.

The Russell 2000 index of smaller companies fell 2.84, or 0.5 percent, to 590.14.

In afternoon trading, Britain's FTSE 100 rose 0.1 percent, Germany's DAX index gained 0.5 percent, and France's CAC-40 rose 0.5 percent. Earlier, Japan's Nikkei stock average fell 1.1 percent.