US stocks down as Shanghai sinks, Greece deadline looms
By KEN SWEET (AP)
NEW YORK (AP) — U.S. stocks were slightly lower in early trading Thursday, following a steep sell-off in the Chinese stock market and the approaching deadline for cash-starved Greece to make a debt payment.
KEEPING SCORE: The Dow Jones industrial average lost 75 points, or 0.4 percent, to 18,085 as of 9:55 a.m. Eastern. The Standard & Poor's 500 index lost eight points, or 0.4 percent, to 2,115 and the Nasdaq composite lost 23 points, or 0.5 percent, to 5,083.
MORE M&A: Chipmakers Avago Technologies and Broadcom agreed to merge in a $37 billion deal. Avago was down $2.20, or 2 percent, to $139.27. Broadcom was down $1.72, or 3 percent, to $55.45.
CHINA DIVE: The Shanghai Composite sank 6.5 percent in another volatile move. Stock market commentator Hexun attributed the fall to several factors including brokerages tightening margin lending, selling by speculators and a Chinese sovereign wealth fund selling shares in two state banks.
Despite a deepening economic slowdown, the index has gained 40 percent in the past three months alone. Chinese leaders have tried to tap brakes on the stock market boom, fearing it could run out of control and disrupt economic reform plans.
GREECE FACTOR: Traders continue to get mixed messages about the progress of talks between Greece and its creditors. Greece said Wednesday it expected to reach a deal to get more bailout loans in time for it to make a key debt repayment on June 5. But its creditors, however, were quick to temper expectations.
Greek stocks were down 1.2 percent. Germany's DAX lost 0.2 percent, France's CAC-40 lost 0.4 percent and the U.K.'s FTSE 100 index was effectively unchanged.
THE QUOTE: "With the situation in Greece rapidly coming to a head and election results showing disenchantment with the status quo and the establishment across the continent, the pressure to reach a solution on Greece has grown rapidly," said Nicholas Teo, analyst with CMC in Singapore, in a market commentary. "Developments on this front may continue to drive trading action in the coming days."
ENERGY: Benchmark U.S. crude fell 65 cents to $56.86 a barrel on the New York Mercantile Exchange.
BONDS, CURRENCIES: U.S. government bond prices didn't move much. The yield on the 10-year Treasury note held steady at 2.14 percent. The euro fell to $1.0888 from $1.0899. The dollar rose to 124.33 yen from 123.75 yen.
AP Business Writer Yuri Kageyama contributed to this report from Tokyo.