Stocks edged lower Friday as investors try to balance easing concerns about Greece’s debt problems with some mixed earnings and economic reports.
The Commerce Department said durable goods orders fell unexpectedly last month because of a sharp drop in aircraft orders. Investors were also disappointed in Travelers Cos. first-quarter results, sending its shares lower.
European stock markets got a boost after Greek officials said they will tap a rescue package from the 15 other countries that use the euro and the International Monetary Fund. The debt-burdened country will have access to about $53.37 billion.
The move gives Greece better interest rates on its debt than it would be able to get from private investors.
Despite the climb in European stocks, there was still some skepticism about whether the bailout provides a long-term solution. The euro weakened compared with the dollar, falling to its lowest level in a year.
U.S. stocks had suffered Thursday morning as concerns about Greece’s debt problem resurfaced after a report showed the country’s deficit last year was larger than first thought. Greece’s debt crisis has spooked investors who worry that other European nations will also struggle with repaying debt, which would stunt a global economic recovery.
The Greek debt problem has been one of the few issues that have made investors pause in recent months as stocks continue a consistent climb higher. The Dow Jones industrial average is on pace for its eighth straight weekly gain. It rose 9 points Thursday after comments by President Barack Obama about financial regulatory reform didn’t provide any surprises.
In early morning trading, the Dow Jones industrial average fell 18.97, or 0.2 percent, to 11,115.32. The Standard & Poor’s 500 index fell 2.36, or 0.2 percent, to 1,206.31, while the Nasdaq composite index fell 4.64, or 0.2 percent, to 2,514.43.
Dow component Travelers stock fell after its first-quarter profit missed expectations because of severe winter storms and the earthquake in Chile. Travelers fell 38 cents to $53.42.
Investors looking to focus on the domestic economy got a mixed report on durable goods orders. New orders for big-ticket manufactured goods dropped 1.3 percent in March because of a steep plunge in commercial aircraft orders. Economists polled by Thomson Reuters had forecast a 0.3 percent jump.
But orders did jump at their fastest rate since 2007 excluding the volatile transportation sector, indicating the manufacturing sector is still improving. New orders for goods that are expected to last at least three years rose 2.8 percent last month. Economists were expecting growth of 0.7 percent.
Investors are also awaiting a report on new home sales that comes a day after the National Association of Realtors said sales of existing homes rose more than expected in March. Thursday’s report helped buoy homebuilder stocks Thursday.
The Commerce Department’s report on new home sales Friday is also expected to show an increase in March after hitting a record-low a month earlier. The report is expected to show sales rose 7.1 percent to a seasonally adjusted annual rate of 330,000, according to economists polled by Thomson Reuters.
Source: The Associated Press.
