NEW YORK (AP) — Stocks wobbled between gains and losses Monday as investors turned their attention toward mixed headlines out of Europe.
Greece’s two main political parties reached a deal over the weekend to share power in a new government, increasing the likelihood that the country will move ahead with austerity measures it promised to implement as part of a financial rescue agreement with lenders. That relieved investors by reducing the chances of an imminent default by Greece, which would rattle financial markets and cause losses for major European banks.
Europe’s debt crisis is far from over, however. Italy’s borrowing rates spiked Monday to the highest level since the country adopted the euro. Unlike Greece, Portugal or Ireland — all of which received financial lifelines — Italy has too much debt to be rescued by its European neighbors. Prime Minister Silvio Berlusconi has rejected suggestions that he resign to make way for more cost-cutting.
The Dow Jones industrial average was down 31 points, or 0.3 percent, to 11,950 at 10:45 a.m. Eastern. The S&P 500 fell 5, or 0.2 percent, to 1,248. The Nasdaq lost 21, or 0.8 percent, to 2,665. The Dow had been up as much as 68 points earlier in the day.
Technology and industrial companies led the S&P 500 downward. Industrials lost 0.7 percent, pulled lower by Caterpillar Inc.
Analysts said Europe’s debt crisis continues to overshadow corporate fundamentals, which are usually the driver of most stock trading in the U.S. “Every day it seems like it’s the butting of heads between whatever the latest rumor is out of Europe with good economic data and corporate earnings,” said Karyn Cavanaugh, a market strategist with ING Investment Management. “It’s overshadowing the fact that earnings are on track to be the best year ever.”
Monday is a relatively quiet day for economic and corporate news in the U.S. The Federal Reserve will report in the afternoon on how much consumers borrowed in September. Economists expect consumers took out an additional $5.4 billion in loans, a sign that households could be more confident in the direction of the economy.
Amgen Inc. rose 4.5 percent to $57.65, the most in the S&P 500 index, after the biotech drugmaker said it would buy back up to $5 billion of its stock. Dish Network Corp. Dish Network Corp. jumped 5.2 percent to $24.70 after the satellite TV provider announced a $2 per share dividend and a 30 percent increase in net income. Home Depot Inc. rose 1.8 percent, the most among the 30 stocks in the Dow, after getting upgraded by analysts.