On 08 June, 2015 – Stocks decline amid concerns over Greece

Stocks mostly declined globally. Investors continue to be concerned about the situation in Greece and when the Federal Reserve will begin to normalize interest rates.
United States
US stocks ended lower on Monday as investors worried about Greece. Last week’s upbeat jobs report for May renewed fears the Federal Reserve will soon raise interest rates. It was another lackluster session, with the Dow Jones industrials down 0.5%, the S&P 0.6% lower and the Nasdaq lost 0.9%.
Airline stocks including American Airlines, Delta, JetBlue and Southwest posted losses. Energy stocks and gambling shares also were lower while automakers saw modest strength. Wynn Resorts retreated after several analysts said gambling revenue this month in Macau will be below their initial estimates. Las Vegas Sands and MGM Resorts International also declined. Distillers and vintners were boosted by a report that Brazilian billionaire Jorge Paulo Lemann is in talks to acquire US based brewer Diageo.
Apple retreated even though it unveiled a series of new products and features at its Worldwide Developers Conference in San Francisco. Sears Holdings declined after it reported a net loss for the first quarter that narrowed from last year. The improved bottom line came despite a revenue drop, reflecting improved gross margins, lower depreciation and amortization expenses as well as higher gain from asset sales. Syngenta again rejected rival Monsanto’s nearly US$45 billion takeover offer. Monsanto shares were up fractionally. Avago Technologies and Micron Technology declined. Avago’s buyout target Broadcom also was down.
Gold at the afternoon London fixing was up US$8.20 to US$1,172.80. Copper futures were up 0.4% to US$2.70. WTI spot crude was down 80 US cents to US$58.33. Dated Brent spot crude was down 48 US cents to US$62.83. The US dollar was down against all of its major counterparts including the euro, yen, pound, Swiss franc and the Canadian and Australian dollars. The Dollar Index dropped 0.25%. The yield on US Treasury 30 year bond was unchanged at 3.11% while the yield on the 10 year note slipped 3 basis points to 2.38%.
Europe
European markets began the new week as they ended the old — they declined. The weakness in the European bond market continued Monday. Greece also remained in focus amid reports that its creditors are losing patience with the country’s stance on its debt obligations. The Greek government and creditors resumed their talks in Brussels during the Monday global market day after both parties failed to reach an agreement on a deal last week. The FTSE slipped 0.2%, the SMI retreated 0.5% and the CAC and DAX lost 1.3% and 1.2% respectively.
The French economy is expected to sustain its growth momentum in the second quarter. Industrial production and services activity are set to continue expansion in June according to survey data from the Bank of France. The BoF retained its growth projection for the second quarter of 0.3%. In the first quarter, the economy expanded 0.4%. The Confederation of British Industry downgraded its outlook for UK growth largely due to weaker than expected first quarter gross domestic product growth. The business group lowered the growth outlook for this year to 2.4% from 2.7% predicted in February. For 2016, the growth forecast was lowered to 2.5% from the previous estimate of 2.6%. Growth in 2014 was 2.8%.
Deutsche Bank advanced after the lender announced Sunday that its co-Chief Executive Officers Anshu Jain and Jürgen Fitschen resigned. They will be replaced by John Cryan, effective July 1. Peer Commerzbank also gained. Auto makers including Daimler, Volkswagen, Renault and Peugeot declined. RWE and E.ON were down. Total was down while Technip gained. Diageo was up on a broker upgrade. Brazilian billionaire Jorge Paulo Lemann is reportedly in talks to acquire the company. Shire declined. The British Pharmaceutical firm is considering a £12 billion bid to acquire Swiss rival Actelion according to a report. Actelion soared in Zurich. Syngenta dropped in Zurich after the company rejected a second takeover proposal from Monsanto. GKN declined with traders citing a report which indicated that Airbus was looking to renegotiate with its suppliers to cut costs.
Asia Pacific
Stocks were mixed Monday as investors here reacted to Friday’s US employment report along with China’s May merchandise trade surplus and Japan’s revised first quarter growth estimate. Japan’s revised GDP figures came well above forecasts, adding to hopes that the economic recovery is gaining traction. The dollar climbed broadly against Asian currencies after the better than anticipated US employment data that has bolstered expectations for a rate increase from the Federal Reserve later this year. Markets in Australia were closed for a holiday.
The Shanghai Composite climbed 2.2% to a fresh seven-year high, even though May merchandise trade data showed both imports and exports declined again in May, in the latest sign that the economy continues to be weak. Exports were down 2.5% on the year while imports tumbled 17.6%. The trade surplus was US$59.49 billion. The Hang Seng added 0.2%.
The Nikkei was virtually unchanged (down 2.71 points) despite revised economic growth figures beating estimates. The yen strengthened against the dollar on an upward revision to Japanese GDP, to an annualized rate of 3.9% for the first quarter from an initial 2.4%. Kobe Steel, Nisshin Steel, Chubu Electric Power, Fanuc, Tokyo Electric Power and Dentsu were lower while Dai-ichi Life Insurance and Mitsui Mining & Smelting climbed. Toshiba gained on a Nikkei report that an internal probe of accounting irregularities had not revealed any new issues.
The Kospi edged down 0.1% as investors await the Bank of Korea’s monetary policy decision on Thursday. Most economists expect the BoK to cut its key interest rate to a record low of 1.5% due to worries over slumping exports and the country’s first-ever spread of the Middle East Respiratory Syndrome.
Elsewhere, India’s Sensex was down 0.9%, Indonesia’s Jakarta Composite index tumbled 1.8%, Malaysia’s KLSE Composite index declined 0.3% and Singapore’s Straits Times index was down 0.2%, while the Taiwan Weighted average dropped 0.3%. The Sensex was down for a fifth consecutive day, this time by 0.9%. Worries about below-par monsoon rains and fading hopes for an interest rate cut continue to keep foreign investors at bay.
Global Stock Market Recap

Please remember, the value of investments and the income from them can do down as well as up. Funds that invest in overseas markets may be subject to currency fluctuations. Investments in small and emerging markets can be more volatile than other overseas markets. Reference in this document to specific securities should not be construed as a recommendation to buy or sell these securities, but is included for the purposes of illustration only.
Looking forward*
China posts May consumer and producer price indices. The UK reports April merchandise trade deficit. The Eurozone posts its second estimate of first quarter GDP. In the US, NFIB reports its small business optimism index for May. Both JOLTS and wholesale trade are posted for April.
*Note — all releases are listed in local time.