Wall Street Opens Lower On Euro Zone Concern
Stocks fell on Wednesday, after a robust rally a day earlier, as limp demand at an Italian debt auction sparked concerns over the financial health of the euro zone.
The S&P 500 index, which rose to within striking distance of its record closing high on Tuesday, was now more than 10 points away from that peak.
Stoking concerns about the euro zone, Italy paid more to borrow over five years than it has since October at an auction Wednesday, as lack of progress in forming a new government and worries about Cyprus's bailout hurt demand.
"The overhang of the Cypriot bailout, and especially its implications for euro zone-wide banking depositors, along with a dip in confidence and lackluster Italian debt auctions have upset the apple cart for U.S. investors determined to assault record stock market highs," said Andrew Wilkinson, chief economic strategist at Miller Tabak & Co in New York.
Cyprus is finalizing capital control measures to prevent a run on its banks by depositors anxious about their savings, after wealthy depositors were penalized under a rescue package agreed with international lenders. Cypriot banks are due to reopen on Thursday.
The Dow Jones industrial average .DJI was down 64.90 points, or 0.45 percent, at 14,494.75. The Standard & Poor's 500 Index .SPX was down 7.39 points, or 0.47 percent, at 1,556.38. The Nasdaq Composite Index .IXIC was down 18.37 points, or 0.56 percent, at 3,234.15.
As Boeing (BA.N) works to regain permission for its 787 Dreamliner to resume flights, it faces what could be a costly new challenge - a temporary ban on some long-distance, trans-ocean journeys the jet was intended to fly.
Boeing was the biggest decliner on the Dow index, shedding 1.6 percent to $85.24.
JPMorgan Chase & Co (JPM.N) also weighed heavily on the Dow, falling 1.5 percent to $47.93 following a report that U.S. prosecutors are examining whether JPMorgan fully alerted authorities to suspicions about fraudster Bernard Madoff.
Short interest in BlackBerry (BB.TO) (BBRY.O) was at record levels and has more than doubled over the course of the last year, according to industry data released on Tuesday. But shares were up 0.3 percent at $14.51 in early trading.
Data showed contracts to buy previously owned U.S. homes fell in February, held back by a shortage of properties, but there was little to suggest that the housing market recovery was stalling. The market's reaction was muted.
Investors will be hearing remarks from several Federal Reserve officials throughout the day, including Chicago Fed President Charles Evans and Boston Federal Reserve Bank President Eric Rosengren.