Nine out of ten sectors end lower led by energy sector
U.S. stocks ended Monday's choppy session slightly lower on 06 July 2015 as global equities came under pressure after Greece on Sunday rejected its international lenders' bailout terms and moved closer to a potential exit from the eurozone. The main indexes fell sharply at the open, but trimmed losses during the day to end modestly lower.
The Dow Jones Industrial Average shed 46.13 points, or 0.3%, to 17,683.98, with 24 of its 30 components closing lower. The Nasdaq Composite ended the day down 17.27 points, or 0.3%, at 4,991.97. The S&P 500 closed down 7.98 points, or 0.4% to 2,068.79, with nine of its 10 main sectors finishing lower. Energy sector stocks sold off after an 8% plunge in oil prices.
The Greece public on Sunday voted no to new austerity measures to keep the country receiving financial aid from the European Union and International Monetary Fund. Odds are growing that Greece will leave the European Union monetary system. Negotiations between Greece and the EU/IMF are continuing despite the no vote. Reports said there will be another EU summit held on Tuesday.
Events in Greece have overshadowed China's heretofore overheated stock market, which is now down nearly 30% in just three weeks' time. The Chinese government enacted new measures over the weekend to stabilize the China equities market, including an injection of government money to stabilize the recent sell off. Many observers argue recent economic developments in China are more important to world markets than the Greece matter. China's economywhich is the world's second-largestis starting to wobble after several years of very strong growth rates.
Although today's main focus was on Greece, it is also worth noting that China's Shanghai Composite gained 2.4%, but that was after the index opened with an 8.0% advance in reaction to news that the People's Bank of China extended a lifeline to equity brokers through China Finance Securities in an attempt to stem the recent slide.
Economic data was limited to the June ISM Services Index, which increased to 56.0 in June from 55.7 in May while the consensus expected the index an increase to 56.3. Business activities accelerated as the related index increased to 61.5 in June from 59.5 in May.
Bullion prices ended higher at Comex on Monday, 06 July 2015. Gold futures snapped a three-session losing streak to settle higher on Monday, finding haven-related buying interest on the back of expectations that one of the commodities biggest sources of demandChinamay take more aggressive action following a recent plunge in its stock market. Gold investors also kept an eye on Greece's deepening crisis and mulled the likelihood of a Federal Reserve interest-rate hike in the coming months.
Gold for August delivery on Comex rose $9.70, or 0.8%, to settle at $1,173.20 an ounce. September silver added 19.1 cents, or 1.2%, to $15.753 an ounce.
Crude Oil futures sank to their lowest settlement in nearly three months on Monday, 06 July 2015 at Nymex as traders fretted the fallout from Greek turmoil as well as a potential Iranian nuclear deal, which may result in a flood of millions of barrels of oil to global supplies.
August crude dropped $4.40, or 7.7%, to settle at $52.53 a barrel on the New York Mercantile Exchange. Prices marked their largest single-session dollar and percentage decline since 4 February 2015.
Treasuries held gains throughout the day, settling not far below their overnight highs with the 10-yr yield down nine basis points at 2.29%.
The dollar traded slightly higher against other major currencies, with the ICE dollar up 0.1% at 96.22.
Monday's trading volume surpassed recent averages with more than 910 million shares changing hands at the NYSE floor.
Tomorrow, May Trade Balance (consensus -$42.00 billion) will be released at 8:30 ET while the May Job Openings and Labor Turnover Survey will cross the wires at 10:00 ET. The day's data will be topped off with the 15:00 ET release of the Consumer Credit report for May (consensus $17.60 billion).
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