Stocks Tumbled on Europe Worries

U.S. stocks fell sharply after the open on Monday as disappointment over the previous session’s jobs report and worries about a spreading European debt crisis weighed. The Dow Jones Industrial Average lately fell 102.17 points, or 0.81%, to 12,555.03. The S&P 500 was down 13.23 points, or 0.98%, to 1,330.57. The Nasdaq Composite was off 20.45 points, or 0.72%, to 2,839.36.

Top officials of the European Council, the European Central Bank and the European Commission will hold an emergency meeting Monday to discuss the possibility that the debt crisis could spread to Italy from Greece, according to a media report Sunday.

With pressure continuing to build but no breakthroughs in sight, budget bargaining between President Barack Obama and top lawmakers resumes Monday at the White House, with both sides hoping to slash the deficit as the price for permitting the government to borrow more than $2 trillion to pay its bills.

Insight into the Federal Reserve’s thinking on the outlook for monetary policy in the US will dominate traders’ attention this week. Tuesday’s release of the rate-setting Federal Open Markets Committee minutes will shed light on policymakers’ strategy on standardising monetary policy. Ben Bernanke, Fed chairman, will add detail in his testimony to Congress on Wednesday, when he is expected to say that a further round of quantitative easing is not justified, despite the slow growth of the US economy and Friday’s weak jobs data.

Oil prices fell below $95 a barrel on Monday. Benchmark oil for August delivery was down $1.33 to $94.87 a barrel at late afternoon Singapore time in electronic trading on the New York Mercantile Exchange.

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