Stocks Opened Sharply Lower on Euro Zone Debt

U.S. stocks fell sharply Tuesday on renewed fears the euro zone’s sovereign debt crisis is worsening and the U.S. economy was slipping back into a recession. The Dow Jones Industrial Average lately fell 204.34 points to 11,035.92. The Standard & Poor’s 500 Index shed 20.86 points to 1,153.11. The Nasdaq Composite Index declined 39.13 points to 2,441.20.

The U.S. economy will likely limp along with slow growth and high unemployment but avoid a recession, World Bank President Robert Zoellick said Tuesday. Europe’s government debt crisis threatens to undermine the confidence of consumers and investors, which would further dampen already weak economic growth, Zoellick said.

Oil prices slipped to near $84 a barrel Tuesday. By early afternoon in Europe, benchmark oil for October delivery was down $2.32 to $84.13 in electronic trading on the New York Mercantile Exchange.

Treasuries rose, pushing 10-year yields to a record low, as concern that the debt crisis in the euro area is deepening underpinned demand for the safest assets. Benchmark 10-year rates dropped two basis points to 1.97 percent as of 11:14 a.m. in London, according to Bloomberg Bond Trader prices.

The Swiss National Bank set a ceiling Tuesday on the value of its currency, which has skyrocketed as traders worldwide frantically search for a safe haven in volatile times. Aiming to protect Swiss exports and the country’s vital tourism industry, the bank said it would spend whatever it takes to keep the Swiss franc from strengthening beyond 1.20 francs per euro. It also indicated it might take even more measures to weaken it further.

Starbucks Corp., the world’s largest coffee retailer, plans to triple its coffee shops in China during the next four years and step up expansion elsewhere in Asia, an executive said Tuesday.Starbucks plans to operate 1,500 outlets in China by 2015 from a current 470, the company’s Asia Pacific president Jinlong Wang said. The company also expects to open 700 coffee shops in South Korea by 2016, up from 370 now, Wang said.

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